DAGONG, IIRA REAFFIRM CREDIT RATINGS OF ABG

DT News Network

Manama 

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Al Baraka Banking Group (ABG), Bahrain announced that Dagong Global Credit Rating Company Limited (Dagong) and Islamic International Rating Agency (IIRA) have jointly reaffirmed the international investment grade credit rating of Al Baraka Banking Group (ABG) at ‘BBB+/A3’ (Triple B Plus/A Three). IIRA has also reaffirmed ABG’s national scale rating at ‘A+(bh)/2(bh)’ (Single A Plus/A Two). Outlook on the assigned ratings is 

‘Stable’.

IIRA has also reassessed the group’s overall fiduciary score in the range of ‘76-80’, which indicates strong fiduciary standards and a well-developed governance structure, wherein rights of various stakeholders are well defined and protected. The fiduciary score is an aggregation of scores assigned to its three sub-sections, namely Corporate and Shari’a Governance at ‘81-85’, and ‘76-80’, respectively, and an Asset Manager Quality score at ‘76-80’.

ABG Bahrain operates under an Islamic wholesale banking license from the Central Bank of Bahrain (CBB), managing locally incorporated Islamic retail banks in 11 countries i.e. Algeria, Bahrain, Egypt, Jordan, Lebanon, Pakistan, Sudan, South Africa, Syria, Tunisia and Turkey, in addition to an investment company in Saudi Arabia and representative offices in Indonesia and Libya. 

The bank said in a statement that the ratings assigned to ABG derive strength from the group’s relatively strong wealth creation ability given increasing demand for Islamic banking services and ABG’s prominent position in the global Islamic banking segment. 

Gradual business growth, well managed spreads and optimum operating efficiency levels have contributed to sustained profitability over the years. However, currency depreciation effects have tended to eclipse growth in operating revenues and assets in recent years, the statement added. 

The bank also said that the governance score assigned to ABG benefits from regulatory supervision in Bahrain being superior to regional benchmarks.

The subsidiaries of ABG are individually regulated by their local banking supervisors. While no department at any of the subsidiaries has a direct reporting line at the parent level, some key control functions including finance, strategic planning, risk management, internal audit and Shari’a compliance liaise regularly with relevant departments at ABG for consolidation and policy framework standardization.