Fitch Ratings has affirmed Bank of Sharjah's (BOS) Long-term Issuer Default Rating (IDR) at 'BBB+' and Viability Rating (VR) at 'bb+'. The Outlook on the Long-term IDR is Stable. A full list of rating actions
is at the end of this release.
BOS's Long- and Short-term IDRs reflect Fitch's belief that there is a high probability that support would be forthcoming from the UAE authorities in case of need, given the strong history of support in the UAE and the government of Sharjah's 15% stake in the bank. A change in Fitch's view of the willingness or ability of the UAE authorities to provide sovereign support for BOS could change the bank's IDRs.
The VR reflects the bank's strong capitalisation and good liquidity position, but also its small franchise, high lending concentrations, weakening asset quality and some concerns over related party transactions, although not uncommon in the region.
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