Moody's Investors Service has upgraded the long-term and short-term foreign currency deposit ratings (FCDR) of BankMuscat (BM) from A3/Prime2 to A2/Prime-1.

The outlook was changed from positive to stable. The Bank Financial Strength Ratings (BFSR) of the affected bank remains unchanged. Also the foreign currency bonds of the bank remain unchanged at A1.

This action was taken after Moody's upgraded the long-term and short-term A3/Prime-2 ceiling for foreign currency deposit ratings to A2/Prime-1, the long-term local and foreign currency government bond ratings toA2 from A3, and the ceiling for foreign currency debt in Oman to Aa3 from A1.

According to Moody’s rating methodology, the deposit ratings are based on BM’s Baseline Credit Assessment (BCA) of Baa1, the local currency deposit ceiling for Oman of Aa2 and Moody’s assessment of the likelihood of government support, which in the case of BM, is assessed to be very high.

Moody’s notes that, going forward, any upgrade to the foreign currency deposit ceiling for Oman would be likely to lead to an upgrade in the foreign currency deposit ratings as BM’s foreign currency deposit ratings are constrained by the country ceiling.

Bank Muscat is headquartered in Oman and reported total assets at March 31, 2007 of OR3.27 billion ($8.473 billion). –TradeArabia News Service