Bank downgrades in Middle East rise in Q1

Global ratings agency Fitch Rating assigned negative outlooks to five banks in the Middle East and Africa during the first quarter of 2009 compared to four in the previous quarter with none of them on positive watch.

New negative outlook was assigned to HSBC Bank Middle East "AA?" in the UAE, in line with the parent. The one negative watch at the end of first quarter related to Bahrain's Investcorp Bank "BBB?". The one Evolving Watch, assigned to Tamweel "A" in the UAE, remained at the end of first quarter. There were no positive outlooks, evolving outlooks or positive watches in the Middle East and Africa at the end of first quarter.

Fitch, however, said negative rating actions in the first quarter remained high, although the number was lower than the peak in fourth quarter of 2008. It took 188 negative rating actions in first quarter, compared with 266 in fourth quarter of 2008. The reduction was mainly caused by less negative rating actions in emerging markets in first quarter, while negative rating actions in developed markets remained high. In contrast, there were no positive actions in emerging markets and only a small number of positive actions in developed markets in first quarter.