FITCH ASSIGNS BOI AA+ ON CREDIT PERFORMANCE
The renowned international rating agency, Fitch, has assigned Bank of Industry (BoI) a national long-term rating of AA+(nga) and national short-term rating of F1+(nga) as the national ratings reflect the bank’s creditworthiness relative to the best credits in Nigeria.
Fitch’s rating is coming on the heels of a domestic credit rating of A- secured by the BoI from a leading Nigerian credit rating agency, Agusto & Co, affirming that the financial institution remains in good financial condition and has a strong capacity to repay obligations on a timely basis.
At a long-term Issuer Default Rating (IDR) of BB- as well as a negative outlook and a short-term IDR of B, Fitch has advocated for increased support for the BoI by the federal government in order to improve the bank’s lending capacity and aid the realisation of its objective.
According to Fitch, BoI’s long-term IDR is at its Support Rating Floor (SRF) of BB-, which considers Nigeria’s ability to provide such support in a timely manner as and at when it is required, as indicated by Nigeria’s long-term foreign currency IDR of BB-.
However, Fitch noted, “The ratings could also be downgraded in the event of material change in the government ownership and/or any change in the bank’s policy role. An upgrade of the Nigerian sovereign would not necessarily lead to an upgrade of the BoI’s IDRs. The BoI’s national ratings are sensitive to any change in Fitch’s opinion of the BoI’s creditworthiness relative to the best credits in Nigeria,” Fitch added.
Speaking on the rating, the managing director of the BoI, Rasheed Olaoluwa, said, “The positive rating is an endorsement of our ongoing transformation project at the BoI and an affirmation of our strategic intent of adopting global best practices in all aspects of our operations.
It further affirms an improvement in Agusto’s rating of the development finance institution.”
According to the Managing Director, “We are determined to make increasing impact in our focus sectors and to continue to set the pace as Nigeria’s leading development bank.