Moody's Investors Service has today changed to negative from stable the outlook on the A2 long-term foreign currency deposit ratings of the two largest (rated) commercial banks in Bahrain, namely National Bank of Bahrain B.S.C. ("NBB") and BBK B.S.C ("BBK" -- formerly Bank of Bahrain and Kuwait BSC). The banks' other ratings are unaffected by this action.
"This rating action follows the change in outlook on Bahrain's A2 foreign currency deposit ceiling to negative from stable on 6 January 2009. NBB and BBK both have foreign currency deposit ratings situated at the A2 ceiling for such ratings in Bahrain, and this ceiling constrains the ratings of both the banks," says George Chrysaphinis, a Limassol-based Moody's Vice President - Senior Analyst, and lead analyst for these two issuers. The foreign currency deposit ratings of other rated retail banks in Bahrain remain unaffected because they are unconstrained by the country's foreign currency deposit ceiling.
Moody's previous rating action on NBB and BBK was the upgrade of their foreign currency deposit ratings to A2, in July 2007. NBB and BBK are both headquartered in Manama, Bahrain, and at the end of September 2008 their assets totalled BHD2.04 billion (US$5.43 billion) and BHD2.18 billion (US$5.80 billion), respectively.