Fitch Ratings has downgraded the three-highest rated banks in Nigeria to Long-Term Issuer Default Rating (IDR) ‘B’ and Viability Rating (VR) ‘b’, and placed National Ratings of all 10 rated Nigerian banks (excluding Stanbic IBTC Holdings) on Rating Watch Negative (RWN), it said Friday.
Ratings of Zenith Bank (Zenith), Guaranty Trust Bank (GTB) and United Bank for Africa (UBA), were revised to Long-Term Issuer Default Rating (IDR) ‘B’ and Viability Rating (VR) ‘b’ over dampened outlook for the industry due to external pressure on the economy.
It warned that “… all Nigerian banks will face material pressures from a weaker operating environment over the next few months given the oil price crash, potential further devaluation of the Nigerian naira and the impact of the COVID-19 pandemic on individuals and businesses,” Fitch said.
Moody’s last week told Bloomberg a weaker naira would “put negative pressure on Nigerian banks’ asset quality and capital metrics as they have a high proportion of foreign-currency denominated loans.”
Earlier today, S&P lowered Nigeria’s long-term rating from B to B- over oil price decline.
