Dagong Global Credit Rating Company and Islamic International Rating Agency (IIRA) have jointly assessed the international scale credit rating of Al Baraka Banking Group (ABG) at 'BBB+/A3' (Triple B Plus / A Three).

In addition, IIRA has assessed ABG's national scale rating at 'A+(bh)/A2(bh)' (Single A Plus / A Two). Outlook on the assigned ratings is 'Stable,’ said a report in the Gulf Daily News (GDN), our sister publication.

IIRA has assessed 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 Sharia governance at '81-85', and '76-80'respectively, and an asset manager quality score falling in the range of '76-80'.

The ratings assigned to ABG derive strength from its strong financial and growth indicators, conservative asset risk profile vis-à-vis local peers, diversification benefits stemming from the group's multinational presence, and adequate liquidity maintained at subsidiary level.

ABG's capital adequacy ratio, though presently sound, has successively trended lower, with growth in business volumes.

External equity injection in addition to greater profit retention may be required to achieve growth in operations as planned.

ABG's profitability indicators are considered strong, having remained profitable in the backdrop of the global financial crisis.

However, the macroeconomic and political outlook in jurisdictions where ABG operates may pose its most significant challenge.

ABG operates under an Islamic wholesale banking license issued by the Central Bank of Bahrain and effectively serves as the managing and parent entity for locally incorporated Islamic retail banks in 11 countries. - TradeArabia News Service