Dubai Islamic Bank says goodbye to Standard and Poor¿s as its ratings agency.
DIB switches ratings from S&P to Fitch
Dubai Islamic Bank (DIB) has dropped Standard & Poor's (S&P) as its ratings agency.
The bank, the biggest Islamic lender in the UAE by total assets, said it had replaced S&P with Fitch Ratings.
"Reflecting the bank's increased focus on the local market, DIB … has disengaged from its previous relationship with Standard & Poor's," it said in a statement. The bank could not be reached for further comment.
Credit ratings agencies scrutinise the operations of companies to ensure they are able to pay their debts. DIB is expected to report its earnings early next month, and to reveal the extent of its provisions for bad loans, including those made to Dubai World.
Jan Willem Plantagie, the regional managing director of Standard & Poor's, said: "We can confirm that we have received such a request from the issuer and we aim to withdraw the rating as soon as possible after a final review by a rating committee, in line with our normal policy on rating withdrawals.
"We are disappointed that DIB has decided to end the long-standing relationship."
S&P rates DIB at "BBB-" with a "negative" outlook, one notch above "junk" and the lowest rating given by three major agencies.
Fitch Ratings yesterday assigned an "A" rating with a "stable" outlook.
UAE corporates such as Taqa and Emirates NBD, have dropped the agency in the past. In January last year, the agency ended coverage of Dubai Holding Commercial Operations Group (DHCOG), which later announced it would restructure its debts.
DHCOG is a unit of the Dubai Holding conglomerate, which is owned by Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai.