BAKU, Azerbaijan, February 14. Fitch Ratings affirmed Kazakhstan-based Industrial & Commercial Bank of China (ICBCK) long-term foreign and local currency Issuer Default Ratings (IDRs) at 'BBB+' with a stable outlook, Trend reports, citing Fitch.
The rating issued highlights Fitch's view of a high probability of support from the bank's parent, in case of a potential challenge. Industrial and Commercial Bank of China Ltd, which currently has an “A+” rating. Fitch believes that state support available to the Chinese bank is also likely to be extended to ICBCK.
Another rating driver is the high quality of the bank’s assets, which are mostly of investment grade. Its placements with the National Bank of Kazakhstan (NBK) and higher-rated foreign banks, along with investments in local sovereign bonds and NBK's discount notes, made up 96 percent of total assets at end-2022.
ICBCK reported a high return on average equity of 30 percent in 2022. Strong profits were underpinned by a wider net interest margin of 19 percent in 2022, a sustainably low cost-to-income ratio (on average 15 percent from 2019 through 2022), and historically negligible impairment charges given its fully performing loan book.
Fitch Ratings Inc. is an American credit rating agency and is one of the most reputable global rating agencies. The agency aims to provide business intelligence to facilitate the effectiveness of decision-making and decrease the business risks for its clients.