Bahrain-based The International Banking Corp. ratings lowered to 'D/D' from 'SD/SD'

The rating action follows the July 30, 2009 announcement by the Central Bank of Bahrain (A/Stable/A-1), that with immediate effect it has exercised its powers to appoint an administrator to TIBC. CBB has determined that TIBC has a substantial shortfall of assets compared to its liabilities. We downgraded TIBC to 'SD/SD' on May 12, 2009, following the bank's default on some of its debt.

According to our rating definitions, we assign a 'D' rating when we believe that any default will be a general default and that the obligor will fail to pay all or substantially all of its obligations as they come due. Our default definition includes payment defaults on both rated and unrated financial obligations.

We assign an 'SD' rating when we believe that the obligor has selectively defaulted on a specific issue or class of obligations but will continue to meet its payment obligations on other issues or classes of obligations in a timely manner.

TIBC is a small wholesale bank registered in Bahrain with total assets of $3.8bn on Dec. 31, 2008. It is wholly owned by Ahmad Hamad Algosaibi & Brothers Company (the Algosaibi Group, not rated). The Algosaibi Group, based in Saudi Arabia's Eastern Province, is active in financial services, bottling and distribution, can manufacturing, real estate investment, hotels, shipping, and contracting. We understand that the Algosaibi Group, including TIBC, has entered into debt restructuring discussions with its creditors.