Qatari bank ratings maintained, following country ceiling upgrade

Moody’s Investors Service has maintained the ratings of the banks it rates in Qatar following the recent upgrade of the government’s foreign and local currency bond ratings and the country ceiling for foreign currency bank deposits of Qatar to Aa2 from Aa3.

The rated banks are Qatar National Bank, Commercial Bank of Qatar and Doha Bank.

Moody’s notes that the foreign currency deposit ratings of Qatari banks were not constrained by the country ceiling and thus are unaffected by the recent upgrade of the ceiling. The banks’ local currency deposit ratings, ranging from Baa1 to Aa3, continue to derive from the unchanged Aa2 Local Currency Deposit Ceiling (LCDC) assigned to Qatar.

According to Moody’s rating methodology, the deposit ratings are based on the individual bank’s Baseline Credit Assessment (BCA), the country’s LCDC and Moody’s assessment of possible support (i.e. parental or systemic being provided to the bank in case of need). The deposit ratings assigned to the Qatari banks benefit from a three-to-four notch uplift, based on Moody’s assessment of a very high probability of systemic support.