Tuesday 02, March 2010 by
Moody's downgrades BMI Bank
According to Moody's, the rating downgrade reflects BMI's weakened franchise and profitability as it reduces its cross-border syndicated lending activity that still forms a large part of the bank's business mix. This development is driven primarily by the much reduced availability of cheap wholesale funding and the weakened financial health of regional borrowers that has led to a marked deterioration in the risk-reward characteristics of this business. Higher levels of credit and liquidity risk have also curtailed the short-to medium-term growth prospects of the bank's niche banking subsidiaries in Africa and in other Middle Eastern markets.
