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Top 50 Safest Banks In Middle East 2017
Author: Andrew Cunningham
GCC banks still dominate, with First Abu Dhabi Bank firmly on top. First Abu Dhabi Bank is the Safest Bank in the Middle East and the only bank in the region to hold three ratings in the AA range. The bank was created in March 2017 through the merger of National Bank of Abu Dhabi, which previously held the top position, and First Gulf Bank, another Abu Dhabi bank, which ranked seventh on last year’s list. The new bank has retained the higher ratings of National Bank of Abu Dhabi. Banks from the four big GCC economies account for 40 of the Safest Banks in the Middle East. The United Arab Emirates (UAE) contributes 12, Saudi Arabia 10, and Kuwait and Qatar nine each. The two smaller GCC economies, Oman and Bahrain, contribute four and three, leaving Israel to complete the picture with three banks. Banks in other Middle Eastern countries do not come close to reaching the 50 Safest. All banks in the 50 Safest Middle Eastern list hold investment-grade ratings. Middle Eastern banks outside the GCC and Israel do not. Moroccan banks come closest, while those in Egypt, Lebanon, Tunisia and Jordan remain deep in sub-investment grade territory. Domestic Bahraini banks also hold sub-investment grade ratings, so they fall outside the 50 Safest. The three Bahraini banks that are included in the ranking—Gulf International Bank, Ahli United Bank and Bank ABC—are able to pierce the Bahrain sovereign-rating ceiling through a combination of foreign ownership and diversified earnings from international, rather than Bahraini, business. Nine of the 12 UAE banks in the 50 Safest are based in either Abu Dhabi or Dubai, the two emirates that dominate the UAE federation, but the smaller emirates of Sharjah, Ras al-Khaimah and Fujairah contribute one bank each (leaving only the tiny emirates of Umm al-Quwain and Ajman unrepresented). Of Qatar’s 10 commercial banks, nine feature in the ranking. The 10th, Masraf Al Rayan gets an A1 from Moody’s—a very high rating for a Middle East bank—but it is unrated by S&P and Fitch and thus ineligible for inclusion: Banks must hold at least two ratings to be included in the list. Similarly, nine of Kuwait’s 11 banks are included. The other two, Kuwait International Bank and Industrial Bank of Kuwait, hold A+ ratings from Fitch but no ratings from Moody’s or S&P. Saudi banks have remained in the top 50 despite a series of steep downgrades last year. Nonetheless, the strongest Saudi bank, National Commercial Bank, ranks only 25th. Moody’s remains the most confident on the Saudi banking system, rating the biggest banks at A1, while S&P continues to be bearish, rating the banks a full four notches lower, at BBB+. The ratings on Qatari banks remain under pressure as a result of the diplomatic spat between Qatar and some of its neighbors. Fitch downgraded several Qatari banks by one notch on in late August (after our 50 Safest rankings had been compiled) and both Moody’s and S&P have Qatari banks on negative outlooks. If these negative outlooks lead to rating action, then Qatari banks will slip several places down the rankings. n Top 50 MIDDLE EASTERN BANKS Rank Group Name Country Ratings Total Score Assets $ mn Statement Date Fitch Moody’s S&P 1 First Abu Dhabi Bank UAE AA- Aa3 AA- 21 185,799 12/31/16 2 National Bank of Kuwait Kuwait AA- Aa3 A+ 20 79,073 12/31/16 3 Qatar National Bank Qatar AA- Aa3 A 19 197,718 12/31/16 4 Abu Dhabi Commercial Bank UAE A+ A1 A 17 70,331 12/31/16 5 Union National Bank UAE A+ A1 N/R 17 28,296 12/31/16 6 Al Hilal Bank UAE A+ A1 N/R 17 11,825 12/31/16 7 Kuwait Finance House Kuwait A+ A1 A- 16 53,902 12/31/16 8 Qatar Islamic Bank Qatar A+ A1 A- 16 38,416 12/31/16 9 Abu Dhabi Islamic Bank UAE A+ A2 N/R 15.5 33,299 12/31/16 10 Al Ahli Bank of Kuwait Kuwait A+ A2 N/R 15.5 13,998 12/31/16 11 Barwa Bank Qatar A+ A2 N/R 15.5 12,651 12/31/16 12 Ahli United Bank Kuwait A+ A2 N/R 15.5 12,062 12/31/16 13 Qatar International Islamic Bank Qatar A+ A2 N/R 15.5 11,690 12/31/16 14 Ahli Bank Qatar A+ A2 N/R 15.5 10,485 12/31/16 15 International Bank of Qatar Qatar A+ A2 N/R 15.5 9,824 12/31/16 16 Doha Bank Qatar A+ A2 A- 15 24,826 12/31/16 17 Emirates NBD UAE A+ A3 N/R 14 121,989 12/31/16 18 Bank Hapoalim Israel A A2 A- 14 116,542 12/31/16 19 Bank Leumi Israel A A2 A- 14 114,071 12/31/16 20 The Commercial Bank Qatar A+ A2 BBB+ 14 35,819 12/31/16 21 Gulf Bank Kuwait A+ A3 A- 14 17,861 12/31/16 22 Al Khalij Commercial Bank (al khaliji) Qatar A+ A3 N/R 14 16,648 12/31/16 23 Commercial Bank of Kuwait Kuwait A+ A3 N/R 14 13,477 12/31/16 24 Boubyan Bank Kuwait A+ A3 N/R 14 11,375 12/31/16 25 National Commercial Bank Saudi Arabia A- A1 BBB+ 13 117,731 12/31/16 26 Al Rajhi Bank Saudi Arabia A- A1 BBB+ 13 90,590 12/31/16 27 Samba Financial Group Saudi Arabia A- A1 BBB+ 13 61,730 12/31/16 28 Banque Saudi Fransi Saudi Arabia A- A1 BBB+ 13 54,248 12/31/16 29 Saudi British Bank Saudi Arabia A- A1 BBB+ 13 49,615 12/31/16 30 Riyad Bank Saudi Arabia A- A2 BBB+ 13 58,032 12/31/16 31 Arab National Bank Saudi Arabia BBB+ A2 BBB+ 12 45,336 12/31/16 32 Dubai Islamic Bank UAE A Baa1 N/R 11 47,643 12/31/16 33 Mashreqbank UAE A Baa1 BBB+ 11 33,441 12/31/16 34 Warba Bank Kuwait A+ Ba2 N/R 11 3,682 12/31/16 35 Sharjah Islamic Bank UAE BBB+ A3 BBB+ 11 9,133 12/31/16 36 Alawwal Bank Saudi Arabia BBB+ A3 N/R 10 28,019 12/31/16 37 Commercial Bank of Dubai UAE A- Baa1 N/R 9.5 17,449 12/31/16 38 Saudi Investment Bank Saudi Arabia BBB+ A3 BBB 9.5 25,163 12/31/16 39 Israel Discount Bank Israel N/R Baa1 BBB+ 9 56,888 9/30/16 40 Gulf International Bank Bahrain BBB+ Baa1 N/R 8 22,906 12/31/16 41 Burgan Bank Kuwait BBB- A3 BBB+ 8 23,747 12/31/16 42 Bank Aljazira Saudi Arabia BBB+ Baa1 N/R 8 17,685 12/31/16 43 RakBank UAE BBB+ Baa1 N/R 8 11,575 12/31/16 44 National Bank of Fujairah UAE N/R Baa1 BBB+ 8 9,711 12/31/16 45 HSBC Bank Oman Oman A- Baa2 N/R 8 5,862 12/31/16 46 Ahli United Bank Bahrain BBB+ N/R BBB 6.5 31,323 12/31/16 47 Bank Muscat Oman BBB Baa2 BB+ 3 28,140 12/31/16 48 Bank ABC Bahrain BBB- N/R BBB- 2 30,141 12/31/16 49 Bank Dhofar Oman BBB- Baa3 N/R 2 10,278 12/31/16 50 National Bank of Oman Oman BBB- Baa3 N/R 2 9,188 12/31/16 Note: Ratings valid on July 31, 2017