Moody’s upgrades Social Islami Bank’s outlook as 'stable'

Desk Report

Publisted at 12:45 PM, Wed Feb 28th, 2024

The Moody’s Investors Service in its latest report has revised Social Islami Bank PLC's (SIBP) credit rating rom "negative" to "stable".

"As of 30 September 2023, liquid assets as a percentage of total assets was low at 8.2%. In addition, 80% of the government securities holdings were encumbered as collateral for borrowings from the central bank to enable the bank to meet the minimum regulatory Cash Reserve and Statutory Liquidity ratios. This limits SIBP's access to immediate funding that requires collateral," Moddy's said in a statement.

The credit rating agency said it expects the bank's funding and liquidity to remain stable over the next 12-18 months.

 One of the key factors contributing to this positive outlook is the improvement in the bank's foreign currency liquidity, bolstered by robust remittance inflows from overseas Bangladeshis, said the statement.

Moddy's also said the bank's deposit base has witnessed diversification, primarily driven by the growth in retail deposits.

Such shift towards a more granular deposit base is expected to

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