Advertise   Subscribe Contact Yemen Post
About Us   Our Mission Terms & Services
Yemen Post Newspaper Logo  
Editor Picture By 2015, closed door meetings for Yemen President Abdurabu Hadi will be limited.... Foreign embassy searches not ruled out....Foreign censorship halted..... Yemenis linked with foreign intelligence hunted for.  
Hakim Almasmari  
 Publisher & Editor in Chief   
  Email the Editor
Advanced Search
LATEST UPDATES Yemen violence continues :: UN in talks over Yemen humanitarian ceasefire :: International community for peace in Yemen launched :: 858 civilians killed in 100-day war in Aden :: Huge airstrikes shake Yemen capital :: Houthis launch new scud on Saudi Arabia-TV :: 600 soldiers trained by Saudi Arabia arrive in Yemen :: Fresh car bombing hits Yemen capital :: Syndicate warns of ongoing abuse of reporters by Houthis :: Government says Aden port attack unprecedented war crime ::
Last updated: 11:40:36 PM GMT(+03) Tuesday, 19, February, 2013

Press Release - International Bank of Yemen's ratings affirmed; financial strength rating outlook raised to 'stable'

 Yemen Post Staff

Capital Intelligence (CI), the international credit rating agency, announced credit rating action on International Bank of Yemen (IBY), based in Sana'a, Yemen.
IBY's Long and Short-Term Foreign Currency Ratings were affirmed at 'B-' and 'C' respectively, and with a 'Negative' Outlook - reflecting the still very challenging operating environment.

The Financial Strength Rating (FSR) is affirmed at 'B'. The FSR is supported by a solid capital adequacy ratio (CAR), good liquidity and a relatively high level of profit at the operating level. The rating is constrained by weak asset quality and the difficult environment, specifically severe weakness in the economy and the attendant risk to the Bank's financials.

The Outlook for the FSR is moved to 'Stable' from 'Negative', reflecting the lower level of non-performing loans (NPLs) to end-June 2012 and good rise in customer deposits in the first half of 2012. The Support Rating is maintained at '4', reflecting limited capacity for support from shareholders.

IBY is Yemen's second largest bank, controlling around 13% of banking system assets. In line with the banking sector profile, IBY's loan portfolio is small as a proportion of total assets with the major asset category comprising Yemeni government treasury bills.

Loan asset quality is very poor, which is reflected in a high level of NPLs against gross loans. NPLs grew significantly in the very difficult year of 2011 but declined in H1 2012. In mitigation, the provisioning level is adequate and the gap between unprovided loans and free capital is reasonable.

Despite the conditions, IBY's profitability, although lower, was adequate in 2011 with net profit impacted by a much higher provision charge. The Bank also benefited from large foreign currency gains due to a long position in US dollars. Nonetheless, IBY's performance is quite good at the operating level and the Bank's operating profit on average assets is the highest in the peer group - aided by good margins and a very low cost base. IBY's large domestic treasury bill portfolio provides a significant and steady interest income stream. At the same time, the Bank carries a high concentration risk to government paper. Liquidity is more than adequate due to its relatively large deposit base and high level of liquid assets but could come under pressure through problems within the treasury bill portfolio. As with the Yemeni banking sector as a whole, IBY's deposit base fell slightly in 2011 due to weaker market confidence but recorded strong growth in H1 2012. The Bank's capital position is sound with the ratio supported by the zero risk-weighting attached to Yemeni government treasury bills.

IBY was established in January 1979 by a Presidential decree. The Bank administers its operations in the Republic of Yemen through its head office located in Sana'a and eighteen other branches (Sana'a, Aden, Hodeidah, Taiz, Seiyun and Mukalla). IBY's shareholder base is dispersed quite widely. At end-June 2012, total assets amounted to YER260bn.





Yemen Post Staff
Source: Yemen Post Newspaper
Energy firms reopen but fears remain amid deadlock
Absence of basic services, unemployment top concerns for Yemeni young-poll
Yemen's Unrest and Attacks on Energy Infrastructure Destabilize National Economy
Political developments affect Yemen-donors relationship
Yemen terminates power purchase contracts
Yemen oil revenues drop $892 million by November
Marib tribes deny standing behind Yemen fuel crisis
Friends of Yemen Conference, Yemen’s new plan is a go
Friends of Yemen Conference kicks off in London
Yemen crude oil export on free fall for February
Leave a Comment
Comment will be published once it has been approved by our moderators.

Yemen Post may edit comments for length and clarity but will not change the tone of the message. Comments will only be accepted if all fields (including name) are filled correctly and the message isn't abusive, defamatory or offensive. All comments sent may be forwarded for use in the Yemen Post newspaper.
Article Tools
Email this Article Email this article
Print Friendly Version Print Freinedly Version
Email this Article Email the Editor
Most popular
 International community for peace in Yemen launched
 Yemen violence continues
 UN in talks over Yemen humanitarian ceasefire
 858 civilians killed in 100-day war in Aden
 Huge airstrikes shake Yemen capital
 The Yemen Post blocked by Houthi militants
  Letters to the Editor
  Dear President
  Submit Your Articles
  Readers' Letters


Quick poll
Do you think President Hadi is building the base to rule Yemen for many years?


© Yemen Post. All Rights Reserved 2007- 2015    

 Designed and developed by