S&P acts on Qatar banks

S&P said it lowered the long-term counterparty credit rating on Qatar National Bank SAQ (QNB) to A from A+.

At the same time, the agency placed the ratings on QNB, Commercial Bank of Qatar, Doha Bank QSC and Qatar Islamic Bank SAQ on CreditWatch with negative implications.

The actions reflect the recent action on the sovereign rating on Qatar. They also reflect the agency’s view that Qatari banks' funding or liquidity profile might weaken as a result of recent developments.

On June 5, a group of states – including Saudi Arabia, the United Arab Emirates (UAE), Bahrain, Egypt, Libya and Yemen – moved to cut diplomatic ties and trade and transport links with Qatar. The measures imposed include a blockade of land, sea, and air access and the expulsion of Qatari officials, residents, and visitors from the group of states.

“We consider that this will exacerbate Qatar's external vulnerabilities and could put pressure on economic growth and fiscal metrics,” S&P said in a news release.

“We have therefore downgraded the long-term sovereign rating on the State of Qatar to AA- from AA and placed it on CreditWatch negative.”

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