Sharjah Islamic Bank

Strong capitalization. High systemic importance in the United Arab Emirates (UAE). Strong relationship with the government of Sharjah. Large exposure to the real estate and construction sectors. Moderate but growing footprint outside Sharjah. S&P Global Ratings' stable outlook on Sharjah Islamic Bank (SIB) reflects our view that the bank's business and financial profiles will remain broadly unchanged over the next 24 months. A positive rating action appears remote in the next 12-24 months because it would require a significant improvement in SIB's intrinsic creditworthiness. We could raise the ratings if SIB materially strengthened its capitalization, with the risk-adjusted capital (RAC) ratio sustainably exceeding 15%, and our view of the bank's operating environment improved. We would consider a negative rating action

...Moderate but growing footprint outside Sharjah. Outlook: Stable S&P Global Ratings' stable outlook on Sharjah Islamic Bank (SIB) reflects our view that the bank's business and financial profiles will remain broadly unchanged over the next 24 months. A positive rating action appears remote in the next 12-24 months because it would require a significant improvement in SIB's intrinsic creditworthiness. We could raise the ratings if SIB materially strengthened its capitalization, with the risk-adjusted capital (RAC) ratio sustainably exceeding 15%, and our view of the bank's operating environment improved. We would consider a negative rating action over the next 12-24 months if we see a significant deterioration in the bank's asset-quality indicators. This could result from higher credit losses in the trading and high-net-worth individual (HNWI) segments than we currently anticipate, or a deterioration of capitalization, with the RAC ratio receding below 10%....

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