Fitch assigns BB- rating to Bank of Industry

04 Jul 2015
Financial Nigeria

Summary

BOI’s National Ratings are sensitive to any change in Fitch’s opinion of BOI’s creditworthiness relative to the best credits in Nigeria.

Rasheed Olaoluwa, MD/CEO, Bank of Industry

Fitch Ratings, the international ratings agency providing issuer and bond ratings, assigned to Bank of Industry (BOI) a Long-term Issuer Default Rating (IDR) of ‘BB-’ with a Negative Outlook and a Short-term IDR of ‘B’. The rating agency also assigned BOI with a National Long-term rating of ‘AA+ (nga)’ and National Short-term rating of ‘F1+(nga)’.

In a statement issued last month, Fitch said BOI’s key ratings are driven by and equalised with Nigeria’s sovereign ratings (BB-/Negative/B). “The Negative Outlook on BOI’s Long-term IDRs reflects the Negative Outlook on the sovereign rating. BOI’s Long-term IDR is at its Support Rating Floor (SRF) of ‘BB-’, which considers Nigeria’s ability to provide such support in a timely manner as and when required, as indicated by Nigeria’s Long-term foreign currency IDR of ‘BB-’” the statement said in part.

Essentially, BOI’s National Ratings are sensitive to any change in Fitch’s opinion of BOI’s creditworthiness relative to the best credits in Nigeria.

In acknowledging the mandate of BOI in financing local industries, Fitch said, “We consider BOI a policy bank given its ownership and its key role in the state’s structural and economic reforms, particularly in developing the non-oil sector.” Fitch further stated that the ratings could be downgraded in the event of material change in the government ownership and/or any change in the bank’s policy role.


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