Ratings agency Moody's said it has affirmed Kuwait'sBurgan Bank an A3 long-term local currency deposit rating with a stable outlook, benefiting from the four notches of support uplift from its ba1 baseline credit assessment (BCA) reflecting the agency's belief of a very high probability of sovereign support if needed.  

The rating also reflects Burgan Bank's good liquidity position and income before provisioning for older non-performing loans (NPLs). The agency, however, remains cautions of the ongoing high credit risk due to the continuing large amount of provisioning for NPLs and the concentration of loans given to related parties.

In addition, it believes that the bank's regional expansion could pose a challenge for the operating conditions, exercising pressure on the financial metrics of its subsidiaries; face risks associated with the integration of acquired entities testing its risk management abilities; keep Tier One capital lower than domestic counterparts.