Standard & Poor (S&P)’s Ratings Services has assigned its A-foreign currency senior unsecured debt rating to the Kingdom of Bahrain's proposed debut issue of international bonds to be made on January 24, 2003.
The issue amount is $500 million, the maturity is five years, and the coupon is four percent annum. The bonds will be registered on the London Stock Exchange. At the same time, Standard & Poor's affirmed its A-/A-2 foreign currency and A/A-1 local currency ratings on Bahrain. The outlook on the country is stable.
"The debut international bond issue will establish a clear credit benchmark both for the government of Bahrain and for other resident entities that may be considering tapping the international capital markets for medium- to long-term financing," said S&P's credit analyst and Director of Sovereign Ratings in the Middle East and Africa, Ala'a Al-Yousuf.
"This benchmark issue will also accelerate the development of Bahrain's domestic capital markets by increasing the diversity and liquidity of securities and strengthening the integration of domestic and international capital markets."
The ratings on Bahrain are supported by a track record of fiscal prudence, a relatively low debt burden, monetary stability, and a robust financial system. They are constrained by a narrow base for government revenues, a lack of transparency in public finances, and uncertainty over the pace of policy execution.
The stable outlook on Bahrain reflects S&P's view that the government will maintain macroeconomic stability and a low debt burden, while it might not make sufficient or early progress on improving the transparency of public finances and implementing structural reforms. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
