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Fitch takes various actions on 6 Omani banks following sovereign downgrade

Fitch Ratings on Dec. 14 downgraded the long-term foreign-currency issuer default ratings of five Oman-based banks, following a similar action on Oman.

Bank Muscat SAOG's long-term foreign-currency issuer default ratings was downgraded to BBB- from BBB, while that of HSBC Bank Oman SAOG was lowered to BBB from A-. The agency also downgraded the long-term foreign-currency issuer default ratings of Bank Dhofar SAOG and Bank Sohar SAOG to BB+ from BBB-, as well as Ahli Bank SAOG's long-term foreign- and local-currency issuer default ratings to BB+ from BBB-. The outlooks on the ratings are negative.

National Bank of Oman SAOG's long-term foreign-currency issuer default rating was affirmed at BBB- but its outlook was revised to negative from stable.

Also downgraded were Bank Muscat's viability rating to "bbb-" from "bbb"; HSBC Bank Oman's short-term foreign-currency issuer default rating to F2 from F1 and those of Ahli Bank, Bank Dhofar and Bank Sohar to B from F3; and the support rating of HSBC Bank Oman to 2 from 1 and those of Ahli Bank, Bank Dhofar and Bank Sohar to 3 from 2.

Moody's also revised down Bank Muscat's support rating floor to BBB- from BBB and those of National Bank of Oman, Ahli Bank, Bank Dhofar and Bank Sohar to BB+ from BBB-.

Affirmed were the F3 short-term foreign-currency issuer default ratings of Bank Muscat and National Bank of Oman; Bank Muscat's 2 support rating; the "bbb-" viability ratings of HSBC Bank Oman and National Bank of Oman; the "bb+" viability ratings of Ahli Bank and Bank Dhofar; and Bank Sohar's "bb" viability rating.

On Dec. 11, Fitch Ratings downgraded Oman's long-term foreign- and local-currency issuer default ratings to BBB- from BBB with a negative outlook as the country's budget deficit is expected to hit 12.8% of GDP, one of the largest among sovereigns rated by the agency.