Export Development Bank of Iran's ratings placed on negative outlook and suspended
- Iran: Saturday, January 26 - 2013 at 10:29
- PRESS RELEASE
Capital Intelligence (CI), the international credit rating agency, announced that it has revised the Outlook on Export Development Bank of Iran's (EDBI) Long- and Short-Term Foreign Currency Ratings of 'BB-' and 'B', respectively, as well as the Outlook on its Financial Strength Rating of 'BB+', to 'Negative' from 'Stable'.
The 'Negative' Outlook for EDBI's ratings takes into account the recent change in the Outlook for Iran's 'BB-' Long-Term Sovereign Ratings to 'Negative' - an adjustment that reflected the current weaknesses in economic management and CI's expectation of a further, and possibly pronounced, deterioration in macroeconomic and fiscal performance over the coming years, as well as a number of political risk factors.
In the last review of EDBI in December 2011, CI noted that the Bank's ratings could be pressured downwards if political risk factors persisted, despite the expectation of a high likelihood of liquidity, as well as capital support by the Iranian government, which owns 100% of EDBI, as reflected in the Bank's Support Rating of '3'.
Under CI's credit policies, ratings may be suspended in cases where the information provided by the rated entity either directly, or through publicly available documents falls short of that required to adequately assess and monitor repayment capacity, but where there is a reasonable likelihood that the required information will be provided in the near future.
EDBI is a policy bank established by an Act of Parliament in 1991 in order to promote Iran's non-oil exports by providing financial services to exporters of Iranian goods and services, such as L/C facilities and export finance.
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