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RIYADH: Banque Saudi Fransi’s $4 billion guaranteed Medium-Term Note program has been assigned a provisional senior unsecured foreign-currency rating of (P)A2 by Moody’s Investors Service.
The MTN program is a special-purpose vehicle established by BSF and the rating is aligned with BSF's A2 long-term deposit ratings, a statement showed.
Securities issued under the programme will constitute direct, unconditional, unsubordinated and unsecured obligations of BSF, according to Moody’s, and rank equally with all other unsecured and unsubordinated from time to time outstanding obligations of BSF.
Under the programme, BSF may issue notes, through BSF Finance, up to a maximum aggregate principal amount of $4 billion.
Based on Moody's view of a very high likelihood of Saudi government support in case of need, the BSF's A2 long-term deposit ratings capture the bank’s Baseline Credit Assessment of baa1 and a two notch uplift.
BSF's well-established corporate banking franchise, strong asset quality, sound capital adequacy and deposit-funded profile secured the sound profitability of the bank thus the baa1 BCA rating.
Both ratings come from BSF's high credit and funding concentrations and continued downside risks on asset risk while some borrowers remain impacted by the pandemic induced disruption, Moody’s said.