GFH Financial Group would like to inform its shareholders and the markets that Fitch Ratings, the international credit rating agency, has affirmed its Long-and Short-Term Issuer Default Rating (IDR) at ‘B’ with the Outlook on the Long-Term IDR as Stable. Fitch has also affirmed the ‘B’/’RR4’ senior unsecured Long-Term Rating of the Group’s US$500 million 2025 certificates issued through GFH Sukuk Company Limited (GFH SCL).
The ratings were noted by Fitch to reflect GFH’s resilient performance since the onset of the pandemic, improved funding access (as evidenced by a sukuk issuance in early 2020) and management’s strategic objective of reshaping GFH’s business model towards more stable and recurring revenue sources, such as fee generation and lower-risk, lower-return investments.
The report looked at each of GFH’s core business lines, which comprise investment banking, real estate and infrastructure investments, treasury activities and commercial banking. Fitch noted that KHCB, the Group’s commercial banking subsidiary, remained a significant contributor to revenues (around 20% in 2020) and net profit, mainly through the provision of Islamic-financing products, which provides a source of more stable deposit funding to the Group.
Mr. Hisham Alrayes, CEO of GFH stated, We’re pleased once again with Fitch’s affirmation of GFH’s ratings in light of the steady progress we continue to make across our core business lines. We are especially proud of their positive assessment of our improved ability to generate more steady steams of revenue and of our profitability during the pandemic, which was a true test of our resilience and the strength of our strategy, which has seen us continue to originate and close key new deals, add value to our investments and deliver growth in new and exciting areas of our business including our treasury activities. We are also pleased with Fitch’s understanding of plans for the future and the positive sentiment expressed on GFH’s strategy to significantly build our assets under management through organic and inorganic growth over the near and longer term. We look forward to continuing building on this progress and executing our strategy with a view to deliver strengthened results and performance in the forthcoming periods.
You may refer to the agency’s website for the report: https://www.fitchratings.com/research/non-bank-financialinstitutions/fitch-affirms-gfh-at-b-outlook-stable-14-06-2021