Fitch cuts Ecobank Transnational

Fitch Ratings said it downgraded Ecobank Transnational Inc. to B- from B.

“At end-1Q20, ETI's double leverage (defined as the equity investments in subsidiaries divided by holdco equity) was high at 157.6%. The ratio has continued to increase from 155% at end-2019 and 150% at end-2018 on the back of lower dividend payments from affiliates, weaker profitability at the holding company and higher foreign-currency translation losses,” Fitch said in a press release.

“The rating actions follow the continuing increase in ETI’s double leverage since 2018 above the 120% threshold at which the agency consider notching the holding company’s ratings down from those derived from the group’s consolidated profile,” Fitch said.

The outlook is stable.

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