...State Support Drives IDRs: Ajman Bank PJSC's (AJB) Issuer Default Ratings (IDRs) are driven by a high probability of support from the UAE authorities, if needed. This reflects the UAE's strong capacity to support the banking system and long record of supporting domestic banks, but also AJB's lower systemic importance due to its small market share and franchise. AJB's Viability Rating (VR) reflects weak asset quality, profitability and capitalisation. Fitch Ratings' assessment of asset quality is based on high potential problem financing, weak reserve coverage, a high risk appetite and sizeable concentrations. The VR also considers the bank's small franchise, undiversified business model and a funding and liquidity profile that is weaker than that of peers. Small Franchise: AJB's market share was less than 1% of banking sector assets at end-3Q21. The small branch network limits financing distribution capabilities and deposit collection. AJB's business model is undiversified, weighted towards...
