OREANDA-NEWS. Fitch Ratings has upgraded the Long-term Issuer Default Ratings (IDR) of Commercial Bank of Qatar (CBQ), Doha Bank (DB), Qatar Islamic Bank's (QIB), Al Khalij Commercial Bank (al khaliji) Q.S.C. (AKB), Qatar International Islamic Bank's (QIIB) and Ahli Bank QSC's (ABQ) to 'A+' from 'A'. Fitch has also upgraded Qatar National Bank's (QNB) Long-term IDR to 'AA-' from 'A+' and its Short-term IDR to 'F1+' from 'F1'. The Outlooks on all the Long-term IDRs are Stable. A full list of rating actions is at the end of this rating action commentary.

The upgrade of all the Fitch-rated Qatari banks' IDRs follows the publication of Qatar's Long-term IDR of 'AA' on 6 March 2015, which provides greater clarity over Qatar's ability to provide support to the banking sector in case of need. (see 'Fitch Publishes Qatar's 'AA' IDRs; Outlook Stable' at www.fitchratings.com). The Qatari banks' IDRs are all support-driven.

The Qatari banking sector is healthy. Local banks are highly capitalised and asset quality is solid with non-performing loans at less than 2% of total loans. Credit growth has slowed as the government has moved to directly financing projects from intermediating via banks. There is a demonstrated strong government commitment to its banks and key public-sector companies.

The revision of the SRFs of these Qatari banks is unrelated to Fitch's global review of the evolving support dynamics for banks.

The VRs of all the banks are unaffected.

KEY RATING DRIVERS - IDRS, SR, SRF AND SENIOR DEBT
Qatari banks' IDRs, Support Ratings (SR) and SRFs reflect Fitch's expectation of support from the Qatari authorities for domestic banks in case of need. This is reflected in the SR of '1' for all banks in the system. Fitch's expectation of support from the authorities reflects Qatar's strong ability to provide support to its banks, as indicated by its rating, combined with Fitch's belief that there would be a strong willingness to do so. The latter is based on a history of sovereign support including recent years' measures to boost capital as well as asset purchases.

The government owns stakes in all the banks following capital injections into the banking system between 2009 and 1Q11. Additional supportive actions taken by the Qatari authorities included direct asset purchases (both loans and equities) in 2009. The sovereign's capacity to support the banking system is sustained by its sovereign wealth funds and on-going revenues, mostly from its hydrocarbon production.

Fitch does not believe that franchise and/or level of government ownership should necessarily lead to a difference in banks' SRFs in the case of Qatar. Fitch expects that there is an extremely high probability that all rated Qatari banks that require support would receive it, irrespective of franchise and ownership, and therefore equalises all banks' SRFs and IDRs at 'A+', except for the flagship bank, QNB.

Fitch makes a distinction between QNB's SRF and that of the other banks in Qatar as a result of its status as the flagship bank in the sector, its role in the Qatari banking sector and close business links with the state.

The Stable Outlooks reflect the Outlook on the Qatari sovereign.

RATING SENSITIVITIES - IDRS, SR, SRF AND SENIOR DEBT
The IDRs, SRs and SRFs are potentially sensitive to a change in Fitch's assumptions around the Qatari authorities' propensity or ability to provide timely support to the banking sector. At present Fitch considers the likelihood of any change to be small.

The rating actions are as follows:

Qatar National Bank
Long Term IDR upgraded to 'AA-' from 'A+', Outlook Stable
Short Term IDR upgraded to 'F1+' from 'F1'
Viability Rating unaffected at 'a'
Support Rating affirmed at '1'
Support Rating Floor revised to 'AA-' from 'A+'
Senior unsecured notes upgraded to 'AA-' from 'A+'

QNB Finance Ltd
EMTN Programme Senior unsecured notes upgraded to 'AA-'/'F1+'
Senior Unsecured Notes (guaranteed by QNB) upgraded to 'AA-' from 'A+'

Commercial Bank of Qatar
Long Term IDR upgraded to 'A+' from 'A', Outlook Stable
Short Term IDR affirmed at 'F1'
Viability Rating unaffected at 'bbb'
Support Rating affirmed at '1'
Support Rating Floor revised to 'A+' from 'A'

Qatar Islamic Bank
Long Term IDR upgraded to 'A+' from 'A', Outlook Stable
Short Term IDR affirmed at 'F1'
Viability Rating unaffected at 'bbb'
Support Rating affirmed at '1'
Support Rating Floor revised to 'A+' from 'A'

QIB Sukuk Funding Ltd
Senior unsecured trust certificates Long-Term Rating upgraded to 'A+' from 'A'

QIB Sukuk Ltd
Trust certificate issuance programme upgraded to 'A+' from 'A'
Senior unsecured trust certificates Long-Term Rating upgraded to 'A+' from 'A'

Doha Bank
Long Term IDR upgraded to 'A+' from 'A', Outlook Stable
Short Term IDR affirmed at 'F1'
Viability Rating unaffected at 'bbb'
Support Rating affirmed at '1'
Support Rating Floor revised to 'A+' from 'A'

Doha Finance Limited
EMTN Programme Senior unsecured notes upgraded to 'A+'/ 'affirmed F1'
Senior unsecured notes (guaranteed by Doha Bank): upgraded to 'A+' from 'A'

Qatar International Islamic Bank
Long Term IDR upgraded to 'A+' from 'A', Outlook Stable
Short Term IDR affirmed at 'F1'
Viability Rating unaffected at 'bb+'
Support Rating affirmed at '1'
Support Rating Floor revised to 'A+' from 'A'

QIIB Sukuk Funding Limited
Senior unsecured trust certificates Long-Term Rating upgraded to 'A+' from 'A'

Al Khalij Commercial Bank (al khaliji) Q.S.C.
Long Term IDR upgraded to 'A+' from 'A', Outlook Stable
Short Term IDR affirmed at 'F1'
Viability Rating unaffected at 'bbb-'
Support Rating affirmed at '1'
Support Rating Floor revised to 'A+' from 'A'

AKCB Finance Limited
EMTN Programme Senior unsecured notes upgraded to 'A+'/ 'affirmed F1'
Senior unsecured notes (guaranteed by Al Khalij Commercial Bank (al khaliji) Q.S.C.): upgraded to 'A+' from 'A'

Ahli Bank Q.S.C
Long Term IDR upgraded to 'A+' from 'A', Outlook Stable
Short Term IDR affirmed at 'F1'
Viability Rating unaffected at 'bbb-'
Support Rating affirmed at '1'
Support Rating Floor revised to 'A+' from 'A'