S&P views Ecobank Nigeria negatively

S&P said it revised its outlook for Ecobank Nigeria Ltd. to negative from stable and affirmed its B- ratings.

“A higher level of problem loans will likely result in higher provisions for Ecobank Nigeria. Pressures on the Nigerian naira (NGN) exchange rate are persisting, following a sharp depreciation to NGN 780/$1 in June 2023. Almost one-third of Ecobank Nigeria's loans are classified as stage 2, which may lead to a further increase in provisions due to the weakening naira. These loans largely stem from and depend on the performance of Nigeria's oil and gas sector, which has been underperforming. Therefore, we do not expect them to be resolved quickly,” S&P said in a press release.

The agency also warned the bank’s scant capital buffers leave the bank at risk of breaching its minimum regulatory requirement, despite its positive net open position.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.