Coronation Merchant Bank announced that it has emerged the first and only internationally rated merchant bank in Nigeria.
Fitch, a global rating agency, has assigned the bank a Long Term Issuer Default Rating (IDR) of ‘B-’ with a Negative Outlook, a Viability Rating (VR) of ‘b-’ and a long-term rating of ‘BBB(nga)’.
The bank’s long and short-Term IDRs are driven by its standalone credit profile as determined by its VR.
A statement explained that Coronation Merchant Bank’s VR reflects the challenging and volatile operating environment in the country which was assigned a national rating of ‘B’/Negative by Fitch.
The bank’s Long- and Short-Term Rating reflects its creditworthiness relative to other issuers in Nigeria. The Negative Outlook on the Bank’s Long-Term IDR reflects the Agency’s view on prevailing operating conditions in the country.
According to the global rating agency, “management quality is a relative strength with the senior team demonstrating a high degree of credibility, experience and depth commensurate with the complexity of the business”. Coronation Merchant Bank boasts of good asset-quality, reporting a zero impaired loans (IFRS 9 Stage3)/gross ratio as at 30 June 2020, which has also been the case since inception.
Commenting on the rating, Managing Director/CEO of Coronation Merchant Bank, Banjo Adegbohungbe, stated that, “The bank’s bold decision to proceed with an internationally accepted rating despite the challenging and uncertain operating environment is a testament to the Bank’s confidence, transparency and determination to continue to enhance its capacity to add value to its clients and stakeholders. We consider this to be a historic milestone on our journey to greatness.”
Also commenting on the maiden international rating, the Chief Financial Officer of the bank, Chukwukadibia Okoye, reiterated that, “despite the volatility of our operating environment and additional headwinds occasioned by the Covid-19 pandemic, the bank will continue to improve on its financial soundness and healthy balance sheet to deliver sustainable earnings and profitability.”