Samba to face credit rating review

25 September 2003
International credit rating agency Moody's Investors Service on 24 September expressed concerns about Saudi American Bank (Samba) allowing its technical management agreement with Citigroup to expire. Samba is in the process of completing transition to local management, as contemplated in the original management agreement. The rating agency said that it will review the Saudi bank's financial strength rating of C+ after the change, which is due to happen at the end of October.

Moody's said the Saudi bank's financial strength rating had reflected the 'benefits derived from its association with Citiroup'. Citigroup said that the termination of the management contract would not affect its 20 per cent stake in the Saudi bank, but may lead to withdrawal of 20 staff seconded to Samba.

Moody's has not altered its investment grade rating of Baa2/Prime-2 for Samba's foreign currency deposits. It said that the bank remained 'well positioned in the Saudi market' (MEED 19:9:03).

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