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S&P Lowers Ratings of Three Dubai Companies - ASHARQ AL-AWSAT English Archive
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DUBAI (AFP) – Standard and Poor’s has lowered the ratings of three Dubai companies and placed four Abu Dhabi groups on credit watch with negative implications, but gave a positive outlook for a number of banks.

The agency lowered by one notch the ratings of giant port operator DP World, a subsidiary of troubled Dubai World, real estate developer Emaar and Dubai Multi Commodities Centre Authority.

It also assigned a negative outlook to DP World and Emaar.

“The downgrade reflects a weaker-than-expected financial profile in 2009 and our forecast of broadly stable ratios in 2010 as well as the majority ownership by a very weak group,” S&P said of DP World.

The action was taken based on the fact that “we do not incorporate into the ratings on these entities any expectation of extraordinary support from the government of Dubai.”

The ratings of four Abu Dhabi government-related entities — Tourism Development and Investment Company, Mubadala Development Co., International Petroleum Investment Company, and Aldar Properties — were placed on credit watch with negative implications.

S&P, however, gave its most positive assessment since the global financial crisis on several United Arab Emirates banks, raising the ratings of Dubai-based Mashreqbank and removing several others from credit watch.

The ratings for Dubai Islamic Bank, Abu Dhabi Commercial Bank, Sharjah Islamic Bank, and the National Bank of Abu Dhabi were affirmed.

The ratings on Mashreqbank, Abu Dhabi Commercial Bank, and Dubai Islamic Bank were removed from credit watch negative.

S&P said that government support for banks figured prominently in its ratings actions on UAE banks.

“Standard & Poor’s believes that the UAE authorities have a strong incentive, as well as willingness and capacity, to preserve the stability of their banking sector,” the agency said.

“In our view, the UAE government has a strong track record of support toward the banking system, and we note that it has taken several measures to boost liquidity in the recent past.”

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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