MON, 04 JULY, 2022-theGBJournal| Fitch Ratings has affirmed First City Monument Bank (FCMB) Limited’s Long-Term Issuer Default Rating (IDR) at ‘B-‘ with a Stable Outlook and Viability Rating (VR) at ‘b- ‘. Fitch has also upgraded the bank’s National Short-term Rating to ‘F1(nga)’ from ‘F2(nga)’ due to the bank’s improving funding and liquidity.
Fitch has withdrawn FCMB’s Support Rating and Support Rating Floor as they are no longer relevant to the agency’s coverage following the publication of its updated Bank Rating Criteria on 12 November 2021. In line with the updated criteria, we have assigned FCMB a Government Support Rating (GSR) of ‘no support’ (ns).
Fitch has also withdrawn the Outlook on the National Long-Term Rating, which due to a clerical error, was incorrectly assigned.
Key Rating Drivers
The VR reflects FCMB’s exposure to Nigeria’s volatile operating environment, a small franchise and high credit concentrations. This is balanced by the bank’s improving funding and liquidity, moderate capitalisation and adequate asset quality for the rating. The latter partly reflects its fairly small loan book (45% of total assets) and large non-loan assets comprising mainly Nigerian government securities (B/Stable).
The Stable Outlook reflects Fitch’s view that risks to FCMB’s credit profile are captured by the current rating, with sufficient headroom under our base case to absorb the fallout from renewed operating-environment pressures.
Fitch has also affirmed FCMB’s National Long-Term Rating reflecting its relative creditworthiness to that of peers in Nigeria.
Fitch Ratings has also affirmed Sterling Bank Plc’s Long-Term Issuer Default Rating (IDR) at ‘B-‘ with a Stable Outlook, Viability Rating (VR) at ‘b-‘ and National Long-Term Rating at ‘BBB+(nga)’.
The rating agency withdrew Sterling’s Support Rating and Support Rating Floor as they are no longer relevant to the agency’s coverage following the publication of its updated Bank Rating Criteria on 12 November 2021.
‘’In line with our updated criteria, we have assigned Sterling a Government Support Rating (GSR) of ‘ns’,’’ Fitch said.-Fitch Ratings
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