...Bank of Bahrain and Kuwait B.S.C.'s (BBK) Issuer Default Ratings (IDRs) are driven by its standalone strength, as reflected by its `b+' Vability Rating (VR). Its VR is capped by the domestic operating environment and, more specifically, Bahrain's rating of `B+', which reflects the bank's large exposure to the sovereign and domestic operating environment. The Negative Outlook on the bank's IDR reflects that on Bahrain. The VR reflects the bank's strong domestic franchise, still adequate asset quality, healthy profitability, high capital ratios and comfortable funding and liquidity. It also reflects high concentration risks. Its Short-Term IDR of `B' maps to the Long-Term IDR. Operating Environment on Negative Outlook: Reasonable oil prices and strong financial backing from partners in the Gulf Cooperation Council support broadly stable operating conditions in Bahrain. However, weak public finances, a high fiscal dependence on oil revenue, rising sovereign debt, low foreign exchange (FX)...
