...State Support Drives Ratings: Riyad Bank's (RB) Issuer Default Ratings (IDRs) reflect an extremely high probability of support from the authorities in Saudi Arabia, if needed. This considers a strong ability to provide support, a long history of support for Saudi banks, as well as RB's status as a domestic systemically important bank (D-SIB). The bank's Viability Rating (VR) reflects its solid domestic franchise, solid earnings generation and strong capitalisation. The VR also considers RB's depressed operating environment in Saudi Arabia, concentrated balance sheet, weakening asset quality and weaker liquidity than other large Saudi banks. Weak Operating Environment: RB's VR considers the depressed operating environment in Saudi Arabia. Fitch Ratings forecasts GDP to contract by 0.4% in 2017, followed by mild growth of 0.8% and 1.3% for 2018 and 2019, respectively, as the kingdom continues with fiscal tightening, limiting opportunities for banks to finance infrastructure projects. There...
