KUWAIT: Burgan Bank announced that Burgan Bank AS (Turkey) (“BBT”) has received a two-notch upgrade in its LTFC IDR from Fitch Ratings in recognition of an improvement in the Bank’s standalone rating and Turkey’s country rating upgrade.

Fitch Ratings has upgraded the Bank’s Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) to ‘BB-’ from ‘B’ and Long-Term Local-Currency (LTLC) IDR to ‘BB-’ from ‘B+’, with a stable outlook. The rating agency also upgraded the Shareholder Support Rating to ‘BB-’ from ‘B’; and the Viability Rating (VR) to ‘B’ from ‘B-‘; whereby the Short-Term Foreign-Currency (STFC) IDR and Short-Term Local-Currency (STLC) IDR were affirmed at ‘B’.

The rating action was announced following the upgrade of Turkey’s Long-Term IDR to ‘BB-’ from ‘B+’, which came in response to numerous factors. These include reduced financial dollarization and foreign exchange (FX) demand, capital inflows, and increased access to external borrowing, which altogether strengthened Turkey’s FX reserves position, thus improving its external buffers. These factors reflected positively on notably reducing the Bank’s near-term financial stability risks, which can be seen in its increased external market access, lower risk premiums, the gradual decline in FX and FX-protected deposits, and the elimination of banking sector FX swaps with the Central bank.

The improved Bank’s viability rating (VR) reflects the Bank’s limited franchise, improving asset quality, adequate capitalization, adequate FC liquidity, and ordinary support from Burgan Bank Kuwait (BBK).

As a core part of its strategy, BBT continues to offer a transformative mobile banking experience to its customers. The bank’s digital banking brand “ON” reached 900,000+ customers as of Aug 2024. ON’s pursuit of emerging as a growth and profitability engine is trending in the right direction. ON digital banking was awarded as “Best Integrated Consumer Site” both in Europe and Turkey at the “Best Digital Banking” award organized by the Global Finance Magazine in 2023.

Building on Burgan Bank Group’s dedication to excellence, BBT continues to derive its growing success from innovative, forward-looking financial solutions, commitment to Environmental, Social, and Governance (ESG) considerations, human capital development, as well as robust risk management and asset re-allocation.