Fitch Ratings has affirmed Emirates Development Bank’s long-term issuer rating at “AA-” with a stable outlook based on the bank’s strong capacity to meet its financial obligations.
The “AA-” investment grade rating from Fitch signifies the entity's high credit quality and low credit default risk.
“This rating affirmation is a solid endorsement of EDB’s creditworthiness and strong capitalisation, positioning the bank for expected rapid lending growth,” said Ahmed Al Naqbi, chief executive of EDB.
“The bank continues to support the UAE's national development agendas in the strategic areas of advanced technology, food security, healthcare, renewables and manufacturing, thereby driving the nation's industrial growth and promoting economic diversification.”
EDB is heavily involved in the government’s efforts to develop its non-oil economic and industrial base.
The lender provides direct and indirect financing to start-ups, small and medium enterprises and large corporates in five priority sectors — manufacturing, infrastructure, advanced technology, food security and health care.
It has set aside Dh30 billion ($8.16 billion) for direct and indirect lending to more than 13,500 companies in priority sectors by 2025.
“In assigning the rating, Fitch considered the bank’s important and clearly defined federal policy role, its 100 per cent strategic federal government ownership,” EDB said on Monday.
The bank approved Dh6.1 billion in financing in 2022, a nearly eight-fold jump compared to the previous year, and aims to offer at least Dh6 billion in funding this year, Mr Al Naqbi told The National in an interview last month.
UAE leaders announce plans to boost local manufacturing
EDB provided loans to about 180 companies last year, Mr Al Naqbi said, with the bulk of them being small enterprises, including 50 to 70 under the “micro” businesses category.
The bank is also increasing its focus on renewables and plans to allocate up to Dh1 billion to support renewable projects this year, Mr Al Naqbi said during a panel discussion at the Investopia event in Abu Dhabi in March.
EDB is also teaming up with The Ministry of Industry and Advanced Technology and Tawazun Industrial Park to provide new financing solutions to support the UAE's defence industry.
It is also partnering with the Abu Dhabi Global Market to support companies looking to set up operations within the international financial centre, and help them expand.
