The upgrade of Emaar's CFR reflects the receding default risk as a result of the following factors:

(i) The company's materially improved liquidity profile after it recently accessed debt capital markets and has established plans to arrange longer term debt, both of which are earmarked for debt refinancing, thereby extending Emaar's overall debt maturity profile and providing some cushion against the sizeable

execution risk on the development front;

(ii) Moody's expectation that Emaar will be able to comply with revised financial covenants established in conjunction with the recent refinancing activity, and the elimination of earlier concerns about Emaar's previously constrained headroom;

(iii) The group's improved operating and financial performance on the back of  increasing contributions from its recurring-revenue segments in 2010 and H1 2011;

(iv) Emaar's assumed ability to maintain financial metrics in line with the Ba rating category in the medium term.

Emaar Sukuk Ltd. rating has been affirmed at B1 based on Moody's expectation that Emaar's capital structure could over time include a higher proportion of secured debt given the high quality and cash-generating capacity of completed assets, with bank lenders possibly being in a preferential position compared with bond and sukuk holders.

Moreover, in view of Emaar's reduced exposure to the Dubai market (with no major ongoing project), Moody's expects the company to become more internationally focused. Given that this makes exceptional support from the government less likely in the near term, Moody's is declassifying Emaar as a government-related issuer and is now assessing the company's rating on a standalone basis.

The Ba3 CFR reflects (i) the company's leading position in the regional real estate market; (ii) some offsetting benefits from the growing diversification of its cash flow base, both internationally and toward recurring revenues; (iii) the expectation of reduced exposure to the Dubai real estate market over the medium term; as well as (iv) an improved financial risk profile that has benefited from the refinancing steps taken by the company's management over the past 12 months.

In Moody's view, it will be critical for Emaar's Ba3 ratings that the company's international operations and associates remain self-financing so as to maintain net leverage on a declining trend, in line with the rating agency's guidance for the company's ratings in the coming quarters.

Moody's also Monday confirmed the Baa2/Prime-3 local and foreign currency debt and issuer ratings of Dubai Bank, following the announcement by the government of Dubai that the bank will be taken over by Emirates NBD (ENBD), the largest bank in the UAE by assets.

Concurrently, Moody's has also confirmed Dubai Bank's E+ bank financial strength rating (BFSR), which maps to a baseline credit assessment (BCA) of B1 on the long-term rating scale. Additionally, the rating agency has confirmed the provisional P(Baa2)/Prime-3 ratings of DB Sukuk Company Ltd., a special purpose entity created to issue Trust Certificates to investors under $5 billion Trust Certificate Issuance Program, launched on behalf of Dubai Bank.

The confirmation of all of Dubai Bank's ratings concludes the review with direction uncertain that Moody's had initiated May 23, 2011. Moody's has assigned a positive outlook to all of Dubai Bank's ratings.