APICORP’s ‘AA’ credit rating affirmed by Fitch

The Arab Petroleum Investments Corporation (APICORP), an energy-focused multilateral financial institution, announces that Fitch Ratings has affirmed its credit rating as a Long-Term Issuer Default Rating (IDR) at 'AA' with a Positive Outlook.

Fitch also affirmed the ‘AA’ long-term ratings on APICORP's Global Medium-Term Note program, debt issues and its Sukuk program.

The ratings are driven by APICORP’s strong credit profile based on the lower of its solvency and improved liquidity assessment, coupled with a 'medium risk' business environment and ‘Excellent' capitalization metrics and liquidity buffers.

The ‘Positive Outlook’ reflects the Corporation’s steady improvement in key solvency and liquidity metrics over recent years, including a sustained lower non-performing loan (NPL) rate, more diversified banking portfolio, and reduction in the share of equity participations as a percentage of total banking exposure.

Fitch also noted APICORP's strong liquidity on the strength of the high credit quality of the Corporation’s treasury assets – 44% of which are rated 'AA-' or above by end of 2022 – and 'excellent' liquidity buffer. The agency also underscored the Corporation’s ‘excellent’ capitalization and 'low' risk profile. Also factoring into the rating is APICORP’s sustained high profitability, particularly relative to its peer group, with a five-year average ROE of 5.4%.

Commenting on the announcement, Mehdi Z. Rizvi, Acting Chief Risk Officer & Head of Credit Risk at APICORP, said: “As one of the highest rated financial institutions in the MENA region, APICIRP’s strong liquidity and credit profiles enable it to continue playing a leading role in support of a pragmatic and sustainable energy transition.”

In addition to its ‘AA’ rating from Fitch, APICORP is also rated ‘Aa2’ by Moody’s and ‘AA-‘ by S&P.

Read the full Fitch report here.