S&P Confirms Jordan’s Steady Credit Rating
Amid regional disturbances and worldwide geopolitical instabilities, Standard & Poor’s (S&P) has confirmed Jordan’s long-term sovereign credit rating at B+/B, assigning it a stable outlook.
2 min
This announcement emphasizes remarkable resilience at a time when many countries are facing declines in their credit ratings. Jordan‘ solid credit position serves as evidence of its effective financial tactics, vital for maintaining financial stability, promoting fiscal responsibility, and progressively lowering its national debt, even amid the challenges posed by the region’s instability.
Strong financial policies and international support
S&P attributes Jordan’s stability to the country’s wise fiscal management and strong monetary policies. The country has effectively maintained stability in its monetary and banking systems, especially in response to international disturbances like the Gaza conflict.
Key to this achievement are Jordan’s financial and monetary reforms, strengthened by substantial support from an International Monetary Fund (IMF) program and international donors. The IMF’s provision of $1.2 billion over four years through its Extended Fund Facility highlights this funding.
S&P anticipates significant fiscal progress, forecasting a reduction in the general government deficit to 1.1% of GDP by 2024 and a decrease in the net debt ratio to 78.9% by 2027. Post-conflict, an increase of $900 million in foreign reserves is expected, along with a decrease in the current account deficit to GDP ratio from 7.2% in 2020-2022 to 4.5% in 2024-2027.
Finance Minister, Mohammad Al-Ississ, considers this confirmation as global recognition of Jordan’s strong fiscal management and policy effectiveness, apart from the challenges posed by the conflict in Gaza and the ongoing tensions in the West Bank.
The Central Bank Governor, Adel Sharkas, points out that the stable rating and outlook reflect the nation’s economic resilience, upheld by the Central Bank’s dedication to monetary and financial stability. This includes keeping the Jordanian dinar’s exchange rate steady, supported by substantial foreign reserves now totaling $18.1 billion. These efforts have made the dinar more attractive, reduced the rate of dollarization to its lowest point since 2016 at 17.7%, and maintained inflation at levels that support economic activity. Sharkas also praised the Jordanian banking sector’s capacity for risk management and its commitment to the highest banking practices.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
Highlighting a significant recovery and robust growth across all key performance metrics.
3 min
Bank of Sharjah has released its results for the period ending 30 June 2024, showcasing robust performance and strong momentum since the beginning of the year. The Bank reported a net profit of AED 171 million, a significant turnaround from the AED 144 million loss in the same period last year.
This remarkable improvement is attributed to a substantial increase in net interest income, stringent credit underwriting, and reduced operating costs, marking a 233% increase over the previous year when excluding the one-time impairment charge from de-linking its Lebanese subsidiary.
The Bank’s exceptional financial results highlight the effectiveness of its strategic focus on sustainable growth, with notable improvements across all major performance metrics. Funded and unfunded income both saw increases, with net interest income rising by 108% and operating income growing by 34%.
Additionally, the cost-to-income ratio improved significantly to 40.1% due to cost discipline measures. The balance sheet remains strong with a loans-to-deposits ratio of 86.63%, indicating comfortable liquidity. The Bank also maintains strong capitalization, with a regulatory capital adequacy ratio exceeding 15% and Tier 1 and CET1 capital ratios around 14%. These positive results underscore the Bank’s underlying strength, operational efficiency, prudent risk management, and ongoing enhancement of shareholder value.
Commenting on the Bank’s results, Sheikh Mohammed bin Saud Al Qasimi, Chairman of Bank of Sharjah, stated: “We are pleased with our outstanding performance in the first half of 2024, which reflects our commitment to adding value to our customers, supporting our communities, and rewarding our shareholders. Despite the challenging geopolitical situation in the region, the UAE economy has remained resilient and continues to register healthy growth following various economic diversification initiatives that provide consistent impetus for trade, investment, and wealth creation. Bank of Sharjah has entered a new chapter with a new leadership team, focused on building new business streams, expanding our reach across the UAE and the region, and delivering exceptional service to our customers.”
He added: “Our performance in the first half of the year demonstrates the effectiveness of our new strategy, and we look forward to delivering continued growth in the years to come.”
The CEO, Mr. Mohamed Khadiri, commented “2024 has begun exceptionally well for Bank of Sharjah, with the bank achieving a record year-on-year profit. I am delighted with our stellar performance as we continue to strengthen the bank’s fundamentals. Our outstanding results reaffirm that our new business strategy is on track to deliver sustainable revenue growth, driven by business expansion, operational efficiency, prudent risk management, and talent development. This achievement is also a testament to the Bank’s success in providing high-quality financial services that meet the aspirations and growing needs of our customers.”
He further added: “Bank of Sharjah is a strong and respected brand within the local community. We are leveraging our core strengths to build a platform that will operate at its full potential across the UAE and the region. The Bank remains focused on executing our strategy and is well-positioned to maintain strong performance throughout 2024 and beyond.”
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
