JCR affirms Maybank’s foreign currency issuer rating at ‘A’ – Business News

KUALA LUMPUR: Japan Credit Rating Agency, Ltd (JCR) has affirmed Malayan Banking Bhd’s foreign currency long-term issuer rating at “A”.

The rating agency said on Wednesday the outlook was also affirmed at Stable and the bonds at “A”.

JCR said Maybank is the largest bank in Malaysia with consolidated assets of RM736bil at the end of 2016. 

Maybank’s core businesses include Islamic banking and non-banking operations such as securities and insurance through its subsidiaries. 

JCR said Maybank has an extensive global network with a focus on the Asean region. 

The ratings reflect its strong domestic business base, diversification of its revenue sources, high profitability, sound liquidity position and high capital adequacy ratios. 

“On the other hand, the ratings are constrained by the sovereign rating on Malaysia (foreign currency long-term issuer rating: A/Stable). 

“This reflects the nature of the banking business, which is, in general, affected by the regulatory environment as well as the economic and financial conditions of the location country,” it said.

JCR noted that Maybank has been experiencing continued deterioration of its asset quality particularly in the corporate loan book affected by low commodity prices in the business area. 

“Nevertheless, JCR holds that the bank has sufficient buffers against a possible increase in credit costs given its sound earnings capacity backed by the strong operating base and high capital adequacy ratios. Based upon these factors, JCR affirmed the ratings with Stable outlook,” it said.

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