GCR re-affirms InfraCredit’s AAA credit rating, outlook stable

Rating agency, Global Credit Ratings (GCR) re-affirmed the “AAA” credit rating of Infrastructure Credit Guarantee Company Limited (“InfraCredit”), for the seventh (7th) consecutive time with stable outlook.

In re-affirming InfraCredit’s AAA rating, GCR emphasised InfraCredit’s strategic role as an infrastructure credit guarantee provider in Nigeria, with a “complete not compete” competitive business nature. The rating recognizes InfraCredit’s strong capital and leverage position, sound risk profile, robust funding and liquidity.

“InfraCredit’s risk position is also a positive rating factor, underpinned by stringent underwriting criteria and the absence of any called guarantee, resulting in no recourse to InfraCredit to date”, the rating agency reported. GCR further accorded the rating to InfraCredit’s stable management team, with a sound risk and portfolio management experience.

The rating agency also highlighted how InfraCredit has progressed well with its mandate delivery, evidenced in the sustained growth in outstanding guaranteed portfolio to N203 billion ($152.6 million) as of 31 March 2024 from N191.8 billion ($213.3 million) in 2023, and N120 billion ($267.5 million) in 2022, spread across prioritised and eligible sectors. Looking ahead, GCR records its high expectations for InfraCredit to encounter sustained business scaling given a pipeline of guaranteed transactions estimated at N627.6 billion ($471.4 million).

InfraCredit’s funding structure is also recognized by GCR to be stable, comprising equity, preference shares and long-term subordinated borrowings from international DFIs.

GCR further indicated that InfraCredit’s competitive position assessment is also supported by a relatively strong Environmental, Social and Governance (ESG) implementation and monitoring, which includes ESG assessments for guaranteed entities and providing additional market access to lower quality corporates. The rating agency, more importantly, positively recognises the progress made in InfraCredit’s clean energy transition within the power sector portfolio and the milestones achieved over the last three years.

Speaking on the ratings outcomes, InfraCredit’s CEO, Chinua Azubike said, “the consistent affirmations of InfraCredit’s “AAA” rating, with stable outlook, by GCR successively for seven years is an exemplification of the resilience and sustainability of our proven and unique business model, strategy execution, strong management team, solid balance sheet, sound quality of our guarantees and strong risk management practice.

Equally noteworthy, is the consistent recognition of InfraCredit’s increasing ESG impact by the rating agency which denotes our commitment towards ensuring a strong consideration of not just economic but social and environmental impacts of all projects we support. The recognition by the rating agency of the positive impact our risk sharing portfolios on our net leverage ratios affirms our growth strategy through partnership and collaboration with our development partners”