Agusto Affirms Abbey Bank’s Ratings on Strong Liquidity Position

By Aduragbemi Omiyale

The short-term “Bbb-” and “A3” credit ratings of Abbey Bank Plc have been affirmed by Agusto & Co, as a result of the lender’s strong liquidity position and balance sheet.

The rating agency also assigned a stable outlook to the ratings, reflecting expectations that its strengthened financial position, expanding franchise and increasing earnings diversification will support its credit profile.

As of December 31, 2025, the bank’s total assets stood at N166 billion, with liquid assets of N148 billion, representing 89 per cent of total assets. Its liquid assets-to-deposits ratio stood at 185.3 per cent, significantly above the regulatory minimum of 20 per cent and industry peers.

The company also maintained an undrawn $20 million reverse repo line as at June 30, 2026, providing an additional liquidity buffer.

Furthermore, its asset quality improved, with the NPL ratio declining from 7.7 per cent in 2024 to 7.2 per cent at year-end 2025 and further to 4.1 per cent as at June 30, 2026, supported by continued recoveries and prudent loan origination.

Abbey Bank’s capital position also strengthened following its successful N64.5 billion equity raise, with regulatory approval received in August 2026, and proceeds to significantly enhance the financial institution’s capital base and support its transition to commercial banking.

The rating further recognised the bank’s improved profitability, with profit before tax rising to N3.1 billion in 2025 versus N2.1 billion in 2024.

As the company expands into construction lending, fixed-income trading, foreign currency transactions and trade finance, it will build a more diversified earnings base and strengthen its long-term growth prospects.

Abbey Bank is preparing to commence commercial banking operations in November 2026, following approval from the Central Bank of Nigeria (CBN) in June 2026, to transition from a national mortgage bank to a regional commercial bank, with a strategic focus on expanding its financial services offerings across the South-West, South-South and North-West regions, as well as the Federal Capital Territory, Abuja.

This transition is expected to strengthen the lender’s capacity to serve a broader customer base, deepen market penetration and diversify its revenue streams.

“The affirmation of our ratings by Agusto & Co., particularly our A3 short-term rating, is a strong endorsement of Abbey Bank’s financial resilience, liquidity strength and strategic direction.

“It reflects the progress we have made in strengthening our balance sheet and preparing for our transition to commercial banking.

“As we embark on this new phase, our focus remains on building a stronger, more diversified and customer-centric bank, while maintaining prudent risk management and sound financial discipline. We are confident that our transformation will create greater value for our customers, shareholders and other stakeholders,” the chief executive of Abbey Bank, Mr Mobolaji Adewumi, stated.