S&P lowers Ahli United Bank

Standard & Poor’s said it lowered the long-term counterparty credit rating on Ahli United Bank BSC to BBB from BBB+.

The agency also said it affirmed the bank’s A-2 short-term counterparty credit rating.

The outlook is stable.

The downgrades reflect a view that economic risks have increased in the banking systems of Gulf countries, including in Kuwait, Bahrain and Oman, in line with the drop in oil prices and the resulting weakening in these economies, S&P said.

Given that the bank has large operations in these countries, the overall riskiness of its core operations also increased, the agency said.

Due to the current pronounced weakness in oil prices, S&P also said it predicts a visible slowdown in economic growth that will pressure the bank and possibly deteriorate its asset quality.

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