Despite the current economic headwinds confronting Nigeria, Fitch Ratings, the global leader in credit ratings and research, has re-affirmed the AAA(nga)’ ratings of Stanbic IBTC Holdings PLC, a testament to the financial institutions’ strong fundamentals and stability.
Stanbic IBTC was given a similar rating last year after a thorough examination of its credit process and financial results. The institution’s diversified loan portfolio was reviewed with its impact on various sectors of the economy taken into account. Among economic sectors impacted by the bank included agriculture, construction, real estate and infrastructure; electricity and other utilities; consumer credit; manufacturing; oil and gas and general commerce. Others were downstream oil and gas, transportation and communication, among others.
The national rating provides a relative measure of credit worthiness for rated institutions in Nigeria and the AAA national rating is assigned to an institution with the lowest relative risk. In the ratings release, Fitch also maintained a stable outlook for Stanbic IBTC Holdings.
In its report, the rating agency also reviewed the capital adequacy of Stanbic IBTC in compliance with regulations and concluded that it was adequately capitalised with capital adequacy ratio above the regulatory requirement. The liquidity position of Stanbic IBTC was reviewed and its ability to meet foreign currency obligations as they fall due. The Group was certified as having adequate liquidity to meet both its short and long term obligations.
In arriving at the rating for Stanbic IBTC, Fitch took account of the strong parental support from Standard Bank Group, which has a majority stake in Stanbic IBTC Holdings Plc, as the group provides support in such areas as staff training, provision of information technology upgrades and best practice processes as well as strong corporate governance practices.