Bahrain Islamic Bank becomes first Islamic bank in the Kingdom to receive Moody's ratings

"This is the first time that the renowned agency has assigned ratings to an Islamic bank in the Kingdom of Bahrain. The ratings report is a significant milestone for the Bank and we are extremely satisfied with it particularly in the current economic environment"

said Khalid Abdulla Al Bassam, the Chairman of Bahrain Islamic Bank.

He added that this reinforces BisB's leading position in Bahrain's Islamic banking industry and is recognition of its strong fundamentals in a number of different areas.

"Moody's ratings recognize the rapid catch-up process the bank underwent from 2005 to 2008, recording high compound annual growth in assets of 37%. BisB had previously leveraged its strong brand and sound reputation to only a limited degree, but in the early years of the current decade it has implemented major organizational changes and a committed hiring program that resulted in senior, experienced officers joining the bank in recent years," said Anouar Hassoune, Lead Analyst at Moody's.

"The significance of our ratings is further augmented by the timing of the report as everywhere in the world banks are bracing for an economic slowdown", added Mohammed Ebrahim, the Chief Executive of BisB. "The stable outlook of all of BisB's ratings is an affirmation that we are well equipped to weather the storm and will continue with our strategy for organic growth and expansion," the CE added.

According to Moody's report, the D+ BFSR, which maps to a baseline credit assessment of Ba1 under Moody's joint default analysis methodology, reflects BisB's growing franchise as Bahrain's leading Islamic commercial bank, strong financial metrics across the board, good asset quality, strong capitalization and ample liquidity.

Mr. Hassoune added that the D+ BFSR also captures the restrictions that Islamic banks face in managing their liquidity, growing competition in the domestic, regional and international Shari'a compliant banking markets as well as the reputation risks to which Islamic banks tend to be subject. "Nonetheless Moody's recognizes that BisB has demonstrated its capacity to weather the current financial stress especially by maintaining ample liquidity cushions," he said in his report.

BisB recently reported a net income of BD 22.3m for the year ended 31 December 2008, with its total assets registering a 33% increase as compared to the previous year to reach BD 874m. It had re-launched itself with a new brand identity and unveiled its new logo in late 2007 while simultaneously increasing its capital through a rights issue to its existing shareholders.

This had contributed BD84.9m of fresh capital to the Bank's financial resources and had more than doubled its equity compared with the previous year.