CAIRO: Fitch Ratings upgraded the Long-term Issuer Default Ratings (IDR) of National Bank of Egypt SAE (NBE) and Egypt-based Commercial International Bank (CIB) from ‘B-‘ to ‘B’ with Stable Outlook, according to a statement posted on Reuters website.
The rating agency upgraded the NBE’s Viability Rating (VR) from ‘b-‘ to ‘b’ and affirmed CIB’s VR at ‘b’. NBE’s and CIB’s Support Ratings were also raised to ‘4’ from ‘5’ and the Support Rating Floors (SRF) to ‘B’ from ‘B-‘. NBE’s National Long-term Rating has been upgraded to ‘AA (egy)’ from ‘AA-(egy)’, according to the statement.
“We have affirmed Credit Agricole Egypt’s (CAE) Support Rating at ‘4’ and its National Long- and Short-term Ratings at ‘AA+(egy)’ and ‘F1+(egy)’, respectively,” Fitch stated.
This decision comes few days after Fitch had raised Egypt’s long-term foreign and local currency issuer default ratings (IDR) to “B” from “B-,” keeping the outlooks at “stable,” according to Friday’s report.
Fitch has also upgraded the issue ratings on Egypt’s senior unsecured foreign and local currency bonds from “B-” to “B”. The country ceiling has been upgraded to “B” from “B-”and the Short-term foreign currency IDR affirmed at “B.”
“Political stability has improved under President Sisi… this reflects a desire for stability, a clampdown on political opposition and an improving economy,” Fitch stated.
In July, the rating agency affirmed Egypt’s long-term foreign and local currency IDR at “B-”, while the outlook was kept at “stable”. However, the agency praised the government’s recent oil price hike as “an important step to reduce subsidies which will contribute to Egypt’s substantial fiscal deficit—a key rating weakness.”