Standard & Poor (S&P) Global Ratings revised its outlook on three Egyptian banks from stable to negative. In a Monday statement, the agency said the three banks, namely the National Bank of Egypt (NBE), Banque Misr, and the Commercial International Bank (CIB) would not withstand a sovereign default without defaulting on their financial obligations.
The agency affirmed its global long- and short-term issuer credit ratings on these banks at “B/B”.
This follows the agency’s revision of its outlook for Egypt from stable to negative on 21 April, while maintaining the country’s local and foreign currencies credit ratings at “B”.
S&P indicated that any decrease in Egypt’s sovereign credit rating will negatively impact the banks’ stand-alone credit profiles as the country’s creditworthiness affects the rating of Egyptian banks.
S&P maintained that NBE, Banque Misr, and CIB’s ratings could be lowered in the next 12 months if Egypt receives a negative rating or the operating environment becomes less supportive for banks.