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LONDON: Fitch Ratings has downgraded Bank of Bahrain and Kuwait (BBK) Long-Term Issuer Default Rating (IDR) to ‘B+’ from ‘BB-’. The outlook is stable.
Fitch has also downgraded BBK’s viability rating (VR) to ‘b+’ from ‘bb-’ and revised the support rating floor (SRF) to ‘B’ from ‘BB-’.
The rating actions follow the downgrade of the Bahraini sovereign rating on August 14, 2020.
The downgrade reflects increased pressure on the bank’s standalone profile from the weakened operating environment and, more specifically, the sovereign downgrade.
The downward revision of the SRF reflects the sovereign’s weaker ability to support as reflected by its lower foreign-currency (FC) reserves and higher debt levels.
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