Jeddah, Kingdom of Saudi Arabia, 28 July 2022,  Moody's Investors Service ("Moody's") has today affirmed the Aaa long-term issuer rating of Islamic Development Bank (IsDB). The Islamic Development Bank's short-term issuer rating has been affirmed at Prime-1. The outlook remains stable.

The affirmation of the IsDB's Aaa rating reflects Moody's view that IsDB's risk profile will remain very strong over the medium-term, supported by low leverage, a very large buffer of liquid assets relative to expected net cash outflows, and a robust stock of callable capital at almost three times the outstanding debt stock.

According to Moody’s, the ratings and the stable outlook reflect the intrinsic strengths of IsDB; in particular its very strong risk profile, very large liquidity buffers, robust capitalization, conservative risk management underpinned by strong risk management policies, and low solvency risks compared with other regional multilateral development banks (MDBs).

Moody’ noted that the IsDB's liquidity position is very strong, and market access is favorable given IsDB's prominence as one of the very few regular issuers of highly-rated sukuk in the world with an investor base that extends beyond Shariah-compliant financial institutions.

The stable outlook reflects Moody's expectation that leverage will remain contained, despite the Bank's plans to grow its development-related portfolio, supported by the expected payments from the shareholders committed under the fourth and sixth general capital increases (GCI) over the next two decades.

Furthermore, risks to IsDB's asset quality are mitigated by a high level of portfolio diversification, the Bank's effective preferred creditor status, and the IsDB Group's policy to restrict disbursements from all standing or new facilities if a borrower is in arrears, which incentivizes borrowers to prioritize repayments to the bank.

On the occasion of the announcement, IsDB’s Vice President for Finance and CFO congratulated all member countries, IsDB Board Members, and Staff for this important achievement that IsDB is considered one of the most highly rated MDBs and the highest in the Muslim World.