Fitch affirms Al Rajhi Bank at 'A-', revises outlook to Stable

Logo of Al Rajhi Bank

Fitch Ratings affirmed Al Rajhi Bank's Long-Term Issuer Default Rating (IDR) at 'A-', revising the outlook to Stable from Negative.

The outlook revision on the IDR reflects its view that pressures on the operating environment from the pandemic and lower oil prices have eased sufficiently, and the financial metrics of the bank have been resilient in the past quarters, despite these pressures.

Strong financing growth will continue to support the bank's earnings in 2021, according to Fitch.

The bank’s viability rating (VR) is underpinned by a strong domestic retail franchise, which results in a clear funding advantage over peers, robust profitability, superior asset quality, lower concentration risks and healthy capitalization.

“Our assessment of its franchise is underpinned by the bank's position as Saudi Arabia's leading retail bank and its Islamic status also enables it to capture a large proportion of stable non-profit-bearing deposits,” Fitch added.