Fitch rates bank's outlook as stable

Bahrain, January 10, 2011
Fitch Ratings has recently reaffirmed Bahrain-based Gulf International Bank's (GIB) long-term issuer default and short-term ratings at A and F1 respectively, with a stable outlook.


The agency also reaffirmed the bank's individual rating at C/D and its subordinated debt obligations at A-.


Fitch stated that GIB's ratings reflect the bank's strong ownership.


The Saudi government through the Public Investment Fund owns more than 97 per cent of the bank.


The rating agency also referred to GIB's good capitalisation, improved performance and its return to profitability.


Fitch also commented that the bank's funding structure has improved in recent years as it has become less dependent on short-term funding.


In addition, GIB's capitalisation has continued to strengthen, and its efforts to de-leverage and de-risk the balance sheet have increased the bank's total capital ratio and Tier 1 ratio to 24pc and 17pc respectively.


"We are very pleased with the ratings reaffirmation by Fitch, especially as it comes at a challenging time for financial institutions," said GIB chief executive officer Dr Yahya A Alyahya.


"We consider this positive announcement by Fitch as an endorsement of the actions taken by the bank and its shareholders to address the challenges created by the changes in the operating environment.


"These ratings reflect the bank's commitment to continue its leading role in the region.


"We will continue to strengthen our franchise in the GCC by providing sophisticated, customer-tailored products and services for the benefit of our customers."