...Banque Misr (S.A.E.)'s (BM) Issuer Default Ratings are driven by its standalone strength, as captured by its Viability Rating (VR) of `b'. They are also underpinned by potential support from the Egyptian authorities. The VR reflects the strong linkage between BM's credit profile and that of the Egyptian sovereign, given the bank's high sovereign exposure. The VR also considers the bank's reasonable loan-quality metrics, solid profitability through the cycle, high liquidity, and a stable funding base, which is underpinned by its leading franchise and strong links with the Egyptian sovereign. BM's weak core capital buffers are a rating weakness. Improving Operating Conditions: Large investment and support packages, greater foreign-exchange rate flexibility and a significant improvement in foreign-currency (FC) liquidity are supportive of Egyptian banks' operating conditions and should underpin greater near-term macroeconomic stability. This is likely to translate into lower inflation and...
