Capital Intelligence assigns first time ratings to Export Development Bank of Iran
- Iran: Monday, March 15 - 2010 at 13:04
- PRESS RELEASE
Capital Intelligence (CI), the international credit rating agency, today announced that it has assigned Export Development Bank of Iran (EDBI) long-term and short-term foreign currency ratings of BB- and B, respectively, a Financial Strength rating of BB+ and a support rating of 3. The outlook for the ratings is Stable.
Following an important increase in capital of IRR13.3 trillion in FY2008, EDBI ranks second among Iranian banks with a capital/total assets ratio in excess of 50%. In FY2009 the Bank returned record profits based on its high interest differential and excellent cost/income ratio. As a wholesale bank with 33 branches, EDBI's access to retail deposits is constrained, although the Bank's liquidity is very strong given its access to official funding. Given the deterioration in operating conditions in FY2009, the Bank's asset quality has worsened and loss reserve cover is low by international standards, although this is mitigated by a good rate of recoveries, reinsurance with the Export Guarantee Fund of Iran and strong collateral security.
EDBI was established by Act of Parliament in 1991 in order to promote non-oil exports and develop business exchanges with Iran's international trading partners. As per its constitution, the object of the Bank is to provide trade finance including pre-shipment and post-shipment buyer credit export financing. The Bank is also the agent in Iran of Islamic Development Bank.
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