...Support Drives Ratings: Burgan Bank's (BB) Issuer Default Ratings (IDRs) reflect an extremely high probability of support from the Kuwaiti sovereign if needed. The Viability Rating (VR) reflects tight capital ratios, a higher risk appetite, asset quality below peers' and pressured profitability. It also considers BB's adequate franchise, strong management, stable funding and contained liquidity risk. Adequate Franchise: BB's domestic and regional expansion and good brand underpin its distribution capabilities, revenue generation, profit margins and deposit collection. BB's franchise benefits from its close relationship with its parent, Kuwait Projects Company (KIPCO). Strong Management: BB's management is highly experienced, with good strategy implementation. KIPCO has a strong influence on BB's strategy and business. Higher Risk Appetite: BB's high concentrations by sector and single obligor as well as risks from regional expansion may undermine risk controls and execution and threaten...
