Dubai - Mubasher: Moody's Investors Service has confirmed the ratings of Commercial Bank of Dubai (CBD), but changed the outlook on the long-term deposits ratings to negative from ratings under review.
The ratings stand at Baa1 long-term deposit ratings, P-2 short-term deposit ratings, as well as the ba1 baseline credit assessment (BCA) and the ba1 adjusted BCA.
Furthermore, Moody's also confirmed the bank's A3/P-2 Counterparty Risk Ratings and the A3(cr)/P-2(cr) Counterparty Risk Assessments, according to a report issued on Thursday.
This rating confirmation reflects the reduced near-term asset quality risk, as the bank's problem loans to gross loans ratio declined noticeably in the third quarter 2018 after a material increase in the first half of the year, the agency noted.
Meanwhile, the negative outlook on CBD's ratings reflects Moody's expectation that despite the improvement in the problem loans to gross loans ratio, the bank's underlying asset quality will continue to deteriorate, in a soft economic environment.