Safest Islamic Banks In GCC 2017 - Global Finance Magazine

As shariah-compliant vehicles gain traction, the agencies are increasingly willing to rate Islamic banks.

The safest Islamic bank in the GCC is Al Hilal Bank, based in Abu Dhabi, with Kuwait Finance House following as second safest. Both banks held the same positions last year. Qatar Islamic Bank moves up five positions to take third place after it received a first-time rating of A1 from Moody’s. Kuwait’s Boubyan Bank moves up one place to eighth following an upgrade by Moody’s.

Global Finance’s ranking of the safest Islamic banks in the Gulf States includes all banks that conduct only shariah-compliant business. In line with the methodology used in our other rankings, banks that are 100% owned by other banks are not eligible for inclusion.

Using these eligibility criteria, there are 26 Islamic banks in the Gulf States (although it should be recognized that many conventional banks conduct a significant amount of their business on a shariah-compliant basis, particularly in Saudi Arabia).

Thirteen of these 26 banks have ratings from at least two of the three rating agencies. There are a further nine that have a single rating—up from seven last year after Moody’s assigned ratings to Oman’s Bank Nizwa and Bahrain’s Khaleeji Commercial Bank. Four banks are unrated. When we first published a ranking of the safest Islamic banks in the Gulf States, three years ago, only 10 banks had at least two ratings and only five had one rating.

Of the 13 banks with at least two ratings, four come from Kuwait and four from the UAE, three come from Qatar and two from Saudi Arabia.

None of the Islamic banks score highly enough to feature in the Safest Global Top 50 ranking or in the 50 Safest Commercial ranking, but the top eight do feature in the Safest 50 Emerging Markets list (with Al Rajhi Bank narrowly missing out).

None of the Islamic banks are large enough to feature among the largest 50 emerging-market banks—the 50th bank in that list has assets of $117.7 billion. Al Rajhi, which is by far the biggest Islamic bank, has assets of $90.6 billion. n

Safest Islamic Banks in the gulf Cooperation Council
Banks with two or more ratings
Rank	Group Name	Country	Ratings			Total Score	Assets $ mn	Statement Date
Rank	Group Name	Country	Fitch	Moody’s	S&P	Total Score	Assets $ mn	Statement Date
1	Al Hilal Bank	UAE	A+	A1	N/R	17	11,825	12/31/16
2	Kuwait Finance House	Kuwait	A+	A1	A-	16	53,902	12/31/16
3	Qatar Islamic Bank	Qatar	A+	A1	A-	16	38,416	12/31/16
4	Abu Dhabi Islamic Bank	UAE	A+	A2	N/R	15.5	33,299	12/31/16
5	Barwa Bank	Qatar	A+	A2	N/R	15.5	12,651	12/31/16
6	Ahli United Bank (Kuwait)	Kuwait	A+	A2	N/R	15.5	12,062	12/31/16
7	Qatar International Islamic Bank	Qatar	A+	A2	N/R	15.5	11,690	12/31/16
8	Boubyan Bank	Kuwait	A+	A3	N/R	14	11,375	12/31/16
9	Al Rajhi Bank	Saudi Arabia	A-	A1	BBB+	13	90,590	12/31/16
10	Dubai Islamic Bank	UAE	A	Baa1	N/R	11	47,643	12/31/16
11	Warba Bank	Kuwait	A+	Baa2	N/R	11	3,682	12/31/16
12	Sharjah Islamic Bank	UAE	BBB+	A3	BBB+	10	9,133	12/31/16
13	Bank Aljazira	Saudi Arabia	BBB+	Baa1	N/R	8	17,685	12/31/16
Banks with one rating
Rank	Group Name	Country	Ratings			Total Score	Assets $ mn	Statement Date
Rank	Group Name	Country	Fitch	Moody’s	S&P	Total Score	Assets $ mn	Statement Date
1	Masraf Al Rayan	Qatar		A1		N/A	25,136	12/31/16
2	Kuwait International Bank	Kuwait	A+			N/A	6,031	12/31/16
3	Alinma Bank	Saudi Arabia	BBB+			N/A	27,928	12/31/16
4	Bank AlBilad	Saudi Arabia		A3		N/A	14,855	9/30/16
5	Noor Bank	UAE	A-			N/A	11,050	12/31/16
6	Al Baraka Banking Group	Bahrain			BB+	N/A	23,425	12/31/16
7	Bank Nizwa	Oman		Ba1		N/A	1,335	12/31/16
8	Bahrain Islamic Bank	Bahrain		B1		N/A	2,729	9/30/16
9	Khaleeji Commercial Bank	Bahrain		B1		N/A	2,029	9/30/16
Note: Ratings valid on July 31, 2017. Asset figures for banks with two ratings or one rating are provided by Fitch Solutions (even if they are not rated by Fitch).