The rating on National Bank of Abu Dhabi (NBAD) reflects the bank's privileged relationship with the government of the oil-rich emirate of Abu Dhabi. The rating also takes into consideration the bank's enhanced profitability, and strong asset quality, liquidity and capitalization. These positive factors are offset, however, by NBAD's reliance on public-sector deposits, and the concentration of its loan portfolio on governmental and public-sector entities. NBAD is the largest bank in the United Arab Emirates (UAE) in terms of total assets. The emirate of Abu Dhabi owns 73% of the bank's capital through the Abu Dhabi Investment Authority (ADIA). As NBAD is the Abu Dhabi government's lending arm, public-sector loans accounted for 49% of outstanding gross loans and 45% of
