...Bank and Sovereign Strongly Correlated: National Bank of Egypt's (NBE) Long-Term Issuer Default Rating (IDR) is driven by its Viability Rating (VR). The bank's VR reflects NBE's dominant market position and its significant exposure to the Egyptian state (B/Stable), both in terms of ownership and through its large portfolio of sovereign debt. SRF Aligned With Sovereign: Fitch Ratings believes that the government's propensity to support NBE, Egypt's largest and fully government-owned bank, is extremely high. However, its ability to do so is severely constrained by the state's weak credit profile, resulting in a Support Rating Floor (SRF) of `B`, in line with the sovereign rating. Bond Portfolio Supports Profitability: NBE's profitability is supported by the high yields on its sizeable government debt portfolio, which accounted for 47% of total assets at end- December 2013 and generated 70% of total net interest income in the six months to end-2013. Underlying operating profitability is adequate...
