Singapore
Moody’s Investors Service has completed a periodic review of the ratings of CIMB Islamic Bank Berhad (CIMB Islamic) and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody’s reassessed the appropriateness of the ratings in the context of the relevant principal methodology, recent developments, and a comparison of the financial and operating profile to similarly rated peers. The review did not involve a rating committee. Since 1 January 2019, Moody’s practice has been to issue a press release following each periodic review to announce its completion.
This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history.
CIMB Islamic’s A3 local- and foreign-currency and issuer ratings are two-notchs above the bank’s baa2 Baseline Credit Assessment (BCA), reflecting Moody’s assumption of a very high probability of support from the Government of Malaysia (A3) and full support from the bank’s parent, CIMB Bank Berhad (CIMB Bank, A3, baa2) in times of need.
CIMB Islamic’s baa2 BCA reflects its strong domestic franchise, as the second-largest Islamic bank in Malaysia by assets and deposits. The BCA also takes into consideration high nominal leverage and credit concentration which increases the bank’s vulnerability to event risks and asset-quality risks during a down cycle. Nevertheless, CIMB Islamic’s strong domestic franchise and robust liquidity will help mitigate some of the risks. This document summarizes Moody’s view as of the publication date and will not be updated until the next periodic review announcement, which will incorporate material changes in credit circumstances (if any) during the intervening period.—Agencies
