WED, NOVEMBER 28 2018-theG&BJournal- ‘’UBA’s local currency funding profile is a rating strength,’’ Fitch, the foremost rating agency declared as it upgraded the pan-African Bank’s valuation to B+ with stable outlook. Fitch also upgraded the bank’s Viability Ratings to b+ from b.
The bank’s stellar 2018 Half year financials despite declining yield environment in two key markets-Nigeria and Ghana, analysts say is convincing enough to earn Fitch’s upgrade.
According to Fitch while assessing the Group’s funding and liquidity profile, ‘’its loans and deposits ratio at 57% at 1H18, is low compared with peers (69%). The deposit base is well diversified by single customer and retail deposits represent approximately one-third of customer deposits, which is higher than the average for peers.’’
Fitch also noted that UBA’s digital offerings continue to attract deposit inflows.
‘’Local currency liquidity ratios are comfortable and the issue of a USD500 million senior medium term bond on the international capital markets in June 2017 eased pressure on the group’s overall foreign currency liquidity position,’’ Fitch said.
UBA today operates in 20 sub-Saharan African countries and in Fitch’s assessment; the bank’s geographic diversification is credit positive because it provides growth opportunities and can reduce exposure to Nigeria’s cyclical economic growth trends.
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