TAIB Bank - ratings affirmed with 'negative' outlook, and then withdrawn
- Bahrain: Thursday, September 06 - 2012 at 16:25
- PRESS RELEASE
Capital Intelligence (CI), the international credit rating agency, announced that it has affirmed TAIB Bank's Long and Short-Term Foreign Currency Ratings (FCR) at 'BB' and 'B', respectively. The Bank's Financial Strength Rating (FSR) of 'BB' was also affirmed.
In the last review of July 2011, CI had noted that the Bank's capital base had been eroded by continued substantial losses in the face of an ongoing difficult investment climate. An unfavourable cost base compounded the losses, suggesting that a major cost cutting programme was necessary.
Although impairment provisions appear to have declined in 2011 and into H1 2012, TAIB Bank's capacity to generate income remains under significant pressure. The cost base continues to exceed gross income by a large margin, straining both liquidity and capital. In CI's view, TAIB Bank's performance in H1 2012 was worse than had been expected, underscoring the mounting challenges associated with restoring profitability in the current environment.
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