S&P revises Saudi's SFG, NCB outlooks to positive on planned merger | ZAWYA MENA Edition
Credit agency S&P said on Thursday it had revised to positive the outlooks for Samba Financial Group (SFG) and National Commercial Bank (NCB) in view of a planned merger, which is expected to be completed in the first half of 2021.
NCB, Saudi Arabia’s biggest lender, signed last October a binding merger agreement with SFG that will create a new banking heavyweight with $223 billion in combined assets.
In a statement, the agency said it had assigned ratings of BBB+/A-2 for both banks. The ratings could also be raised over the next 12-24 months.
“The positive outlooks reflect that we could raise the ratings for both NCB and SFG over the next 12-24 months if, upon the transaction's successful completion, we continue to assess the merged entity as having a superior franchise value, a more balanced credit risk profile, and strong capitalisation,” S&P said.
Shareholders of both banks are due to vote on the merger in March.
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