...Operating Environment Constrains Ratings: Bank of Jordan Plc's (BOJ) Issuer Default Ratings (IDRs) are driven by its standalone strength, as defined by its Viability Rating (VR). The domestic operating environment remains challenging and characterised by below-potential GDP growth, high unemployment and a difficult regional environment, which constrains the country's growth potential. Moderate Domestic Franchise: BOJ is the seventh-largest bank in Jordan, with a market share of about 5% of total banking sector assets, and is classified as a domestic-systemically important bank (D-SIB) by the Central Bank of Jordan (CBJ). The bank lends mainly to domestic corporates and the loan book is fairly concentrated, with the 20 largest loans accounting for 1.4x the bank's common equity Tier 1 (CET1) at end-3Q19, exposing the bank to event risk. Expected Loan Deterioration: The bank's impaired (Stage 3) loans ratio has been deteriorating since 2017 and was 6.3% at end-3Q19, still comparing well with...
