Fitch affirms National Bank of Egypt UK at 'BB+'; Outlook Positive

The Long-and Short-term IDRs of NBE UK reflect Fitch's view of the moderate probability of support that would flow to the bank, ultimately from the Egyptian authorities, via its 100% owner, National Bank of Egypt (NBE, 'BB+'/Positive/'B'). They are aligned with those of NBE and the Egyptian sovereign ('BB+'/Positive/'B'). The Positive Outlook on NBE UK reflects that of the Egyptian sovereign. This is based on NBE UK's strategic and reputational importance to NBE and the Egyptian authorities. NBE UK's Individual rating reflects the bank's moderate, though improving, profitability and concentrations on both sides of the balance sheet. However, it also recognises its strong balance sheet liquidity, good asset quality and adequate capitalisation.

Upside potential for NBE UK's IDRs and Individual rating could arise from a stronger core franchise, greater scale and further improvements in profitability. Downside risk could arise from deterioration in asset quality or a rise in concentrations.

NBE UK is a wholly owned subsidiary of National Bank of Egypt ('BB+'/Outlook Positive), the largest state-owned bank in Egypt. The bank is incorporated in the UK and supervised by the Financial Services Authority. NBE UK's activities include money-market dealing, debt securities, international syndications, commercial lending and trade finance.