Fitch affirms UBA’s viability rating as Agusto upgrades rating to ‘Aa’

Fitch International, one of the foremost global rating agencies has affirmed United Bank for Africa (UBA) Plc’s viability rating at ‘B,’ as the pan-African banking group continue to sustain its benchmark asset quality and strong profitability amidst industry and macroeconomic challenges.

UBA is one of the few banks with strong risk management framework, which has helped keep non-performing loans ratio at a moderate level of 1.74 per cent as at the end-March 2016, as against industry average of over six per cent as reported by Fitch in its recent report on Nigerian banks.

Fitch also upgraded UBA’s outlook to stable from Negative, thus reinforcing the strong outlook on the Bank, especially as its diversified network across eighteen other African countries make it relatively immune  against the potential cyclical volatilities in any of its country of operations.

Also, the foremost local rating agency in Nigeria, Agusto & Co,  at its rating review of UBA Plc, upgraded the Bank’s rating from ‘A+’ to ‘Aa-,’ with a stable outlook. According to Agusto & Co, “the rating of United Bank for Africa Plc (UBA) is upheld by the Bank’s improved capitalisation, good liquidity and large pool of stable deposits, strong domestic presence supported by the Bank’s extensive branch network and growing alternative banking channels.

“We note improvement in profitability and the bank’s good asset quality. The Rating takes into cognizance the weak macroeconomic climate on the banking industry’s asset quality, which we do not expect UBA to be excluded. Nonetheless, we note positively its diversified geographical reach, which will cushion to an extent the impact of the weak Nigerian economic climate,” Agusto & Co stated in its credit rating report.