International rating agency Fitch Ratings has placed Kuwait's Burgan Bank SAK's Long-term rating of 'A-' (A minus) and Individual rating of 'C/D' on Rating Watch Negative. The bank's Short-term and Support ratings of 'F2' and '2', respectively, are affirmed.
The rating action reflects the following factors: disappointing performance of the bank in 2002 on account of a sharp deterioration in net income to 12.8 million Kuwaiti dinars in 2002 from KD20.7 million in 2001; the identification by its auditors of accounting irregularities in respect of an externally managed investment portfolio that resulted in a five million KD realized loss for the bank; and a new untested management team that will be operating in a competitive and difficult operating environment.
Established in 1977, Burgan Bank is one of the smallest Kuwaiti Banks with a modest network of 15 branches and a 14 percent share of total deposits. KIPCO, a private sector investment company with a 50 percent stake is its largest shareholder. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
