Fitch affirms ANB rating at 'BBB+', outlook negative

Fitch Ratings affirmed Arab National Bank's (ANB) Long-Term Issuer Default Rating (IDR) at 'BBB+' with a Negative outlook. Fitch also downgraded ANB's Viability Rating (VR) to 'BBB' from 'BBB+' and removed it from Rating Watch Negative (RWN).

"The downgrade of ANB's VR reflects our view that its financial metrics are more prone to deterioration than larger peers, due to the smaller exposure to lower-risk retail assets, providing it with lower protection against a weakening operating environment," Fitch said.

The downgrade also represents Fitch's reassessment of the bank's credit profile against domestic and regional peers considering the challenging economic environment.

"We do not expect deterioration leading to a further downgrade of the VR in the short to medium term," the rating agency said.

Fitch placed all 10 Saudi banks' VRs on RWN in March 2020 to signal heightened risks of a severe deterioration in the domestic operating environment following the sharp fall in oil prices and pressures from the coronavirus-related economic disruptions