Thomson BankWatch, the US bank ratings agency, has assigned an investment-grade sovereign rating of BBB- to Oman and assigned new ratings to one bank in Saudi Arabia, one in Oman, one in Kuwait and two in the UAE.

BankWatch says the rating for Oman is based on its strong oil and gas revenues and its stable economic and political situation. At the same time, dependence on oil makes Oman vulnerable to price volatility, while big investment projects will push up its import bill in the next few years.

The agency also rated five Gulf banks, including Saudi Arabia’s Al-Rajhi Banking & Investment Corporation and National Bank of Abu Dhabi, which was also rated for foreign currency debt at A+. BankWatch upgraded the issuer rating of Saudi Hollandi Bank to IC-B from IC-B/C and affirmed the existing ratings of National Bank of Kuwait and Riyad Bank.