Fitch Ratings has today affirmed National Bank of Kuwait (NBK)’S ratings at Long-term A+, Short-term F1, Individual A/B and Support 2. The Outlook is Stable, stated a press release.
The affirmation reflects NBK's track record of conservative management and good asset quality, as well as its sound liquidity and capital ratios. However, Fitch is concerned about the declining trend of the bank's capital ratios during the last four years, in a potentially volatile operating environment. If the trend persists, the ratios, albeit strong, could become inconsistent with the current high Individual rating.
Fitch is also concerned with NBK's limited potential to grow its business within Kuwait, given the relatively small size of the market and the challenges the bank faces in expanding its franchise outside Kuwait.
NBK was established in 1952 as the first indigenous bank in the Gulf and, until the formation of the Central Bank of Kuwait in 1968, it also performed some of the functions of a central bank. A group of leading local merchant families owns approximately 80 percent of the bank with the 20 percent balance being widely dispersed. It is primarily a regional bank with a dominant market position in Kuwait. — (menareport.com)
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