Economy

GCR Upgrades C&I Leasing Issuer Rating To BBB(NG)

Published

8 years ago

10/11/2017

By Modupe Gbadeyanka

Global Credit Ratings (GCR) has upgraded the long term national scale issuer rating assigned to C&I Leasing Plc to BBB(NG) and affirmed the short term at A3(NG); with the outlook accorded as stable. According to a statement issued by the local rating agency, the above credit ratings were accorded to C&I Leasing Plc after taking into cognisance of C&I’s well-entrenched position in key markets, as borne out by a relatively strong client retention and progression in market share amidst challenging operating conditions.

It explained that the repositioning of the group’s business focus on strongly performing segments has also supported sound traction in the operating lease space, with performance expected to show resilience through the cycle.

Having registered sound top line growth (at a compound rate of 10.2%) over the four years under review, the group achieved a 43% annualised increase in revenue in 3Q FY17, on the back of new vessel leasing contracts.

The EBITDA margin has shown moderate variability over the review period, with transient compression seen in FY16 offset by the traction from higher-yielding leases secured in the current year.

Specifically, the margin rebounded to 34.7% in 3Q FY17, well above a four-year average of 27.5%, and is projected at 36.2% for the full year.

GCR is cognisant of pressure that could arise from traction in the operating lease profile, which could cause margin volatility, should management fail to manage the residual risk inherent in these contracts effectively.

Accordingly, progress will continue to be monitored closely to assess the repackaging of the underlying assets into new contracts or their disposal to maintain a robust earnings stream or efficiently recycle capital through the cycle, the rating firm said.

Adjusting performance for sizeable distortions arising from cross currency exposures and changes in valuations reveals the moderate cash generative capabilities of C&I’s operations.

That said, note is taken of the capital intensity of the trading cycle and the sizeable debt servicing outflows. GCR has considered the ample untapped facilities that are in place, the strength of the financing counterparties, the risk transfer in respect to the finance leases and sound performance of the leasing book.

As with most lease financing entities, the Group is relatively thinly capitalised. In comparison, debt has risen markedly from just N11bn at FY13 to N29bn at 3Q FY17 to finance the rapidly advancing operating lease exposure, which has seen gross and net gearing trend at high levels, over the review period, closing 3Q FY17 at 435.6% and 413.9% respectively (FY16: 441%; 423%).

That said, earnings based gearing metrics are relatively comfortable for the Group’s operating model, registering at 369% and 350% on a gross and net basis respectively at 3Q FY17 (FY16: 540%; 519%). Coupled with the expected resilience of cash earnings expected over the rating horizon, this gives comfort in spite of the relatively erratic interest coverage metrics.

A significant improvement in profitability metrics, asset quality and gearing could result to a positive rating action.

However, material weakening in profitability, debt to EBITDA or pressure on debt service due to unforeseen fall off in business volumes or deterioration in operating conditions. Furthermore, marked deterioration in asset quality would warrant rating action, GCR noted.

Economy

PEBEC Blocks Introduction of New Policies by MDAs

Published

3 hours ago

07/04/2026

Adedapo Adesanya

By Adedapo Adesanya

The Presidential Enabling Business Environment Council (PEBEC) has directed Ministries, Departments, and Agencies (MDAs) to suspend the introduction of new policies and regulatory changes to prevent disruptions to businesses.

The directive was issued in a statement by PEBEC director-general, Mrs Zahrah Mustapha-Audu, on Monday in Abuja, noting that the move is part of the Federal Government’s broader effort to improve regulatory quality, ensure policy consistency, and strengthen Nigeria’s ease of doing business environment.

The council emphasised that the suspension will remain in place until all MDAs fully comply with the Regulatory Impact Analysis (RIA) Framework, which governs evidence-based policymaking across government institutions.

The council said the directive is aimed at ensuring that all government policies are backed by verifiable data and do not negatively impact businesses or investors.

“It is imperative to emphasise that no new reform or policy will be permitted to proceed without being grounded in clear, verifiable evidence,” said Mrs Mustapha-Audu.

“The framework provides the structured mechanism through which such evidence-based decisions can be rigorously developed, assessed, and validated.

“This directive is necessary to prevent policy shocks that may adversely affect businesses, investors, and citizens, as well as to eliminate policy inconsistencies and frequent reversals.”

She added that the government remains committed to working collaboratively with regulators and does not intend to embarrass any institution.

The Regulatory Impact Analysis (RIA) Framework, introduced in January 2025, is designed to improve transparency and ensure that policies undergo proper evaluation before implementation.

All MDAs are required to align new policies and amendments with the RIA framework before approval and rollout.

The framework has been circulated by the Office of the Secretary to the Government of the Federation (SGF) and is available on the PEBEC website.
MDAs are encouraged to seek technical support from the PEBEC Secretariat to ensure proper implementation.

Exceptions to the directive will only be granted in cases of urgent national interest, subject to appropriate approvals.

PEBEC noted that the framework will help institutionalise evidence-based policymaking, enhance transparency, and improve stakeholder confidence in government decisions.

Economy

DMO Sells 3-Year FGN Savings Bond at 14.082% for April Batch

Published

4 hours ago

07/04/2026

Aduragbemi Omiyale

By Aduragbemi Omiyale

Subscription for the Federal Government of Nigeria (FGN) savings bonds for April 2026 has opened, a circular from the Debt Management Office (DMO) on Tuesday, April 7, 2026, confirmed.

The debt office is selling the retail debt instrument for this month in two tenors of two years and three years.

Offer for the savings bonds opened today and will close on Friday, April 10, 2026, a part of the disclosure stated.

The 2-year FGN savings bond due April 15, 2028, is being sold at a coupon rate of 13.082 per cent per annum, while the 3-year FGN savings bond due April 15, 2029, is being sold at a coupon rate of 14.082 per cent per annum.

The interests are paid every quarter, and the bullet repayment to subscribers on the maturity date.

The bonds are sold at N1,000 per unit, subject to a minimum subscription of N5,000 and in multiples of N1,000 thereafter, subject to a maximum subscription of N50 million.

Interested investors are required to reach out to the stockbroking firms appointed as distribution agents by the DMO via the agency’s website.

An FGN savings bond qualifies as securities in which trustees can invest under the Trustee Investment Act. It also qualifies as government securities within the meaning of the Company Income Tax Act (CITA) and the Personal Income Tax Act (PITA) for tax exemption for pension funds, amongst other investors, meaning it is tax-free.

It can be used as a liquid asset for liquidity ratio calculation for banks, and is listed on the Nigerian Exchange (NGX) Limited to allow for easy exit (liquidation) before maturity by selling at the secondary market.

Economy

Oil Prices Rise as US-Iran Tensions Escalate Despite Talks

Published

7 hours ago

07/04/2026

Adedapo Adesanya

By Adedapo Adesanya

Oil prices climbed on Monday’s short trade as the United States and Iran threatened more attacks, as the two countries are engaging in indirect talks that could lead to the de-escalation of hostilities.

Brent crude futures settled at $109.77 ‌a barrel after chalking up 74 cents or 0.68 per cent, while the US West Texas Intermediate (WTI) crude futures traded at $112.40 after growing by 87 cents or 0.78 per cent.

The US and Iran received a framework from Pakistan to end hostilities, but this was rejected by Iran, especially the idea of immediately reopening the strait after President Donald Trump threatened to ⁠rain “hell” on the nation if it did not make a deal by the end of Tuesday.

Iran said it had formulated its positions and demands in response to recent ceasefire proposals conveyed via intermediaries.

The US is eyeing an agreement to open the crucial Strait of Hormuz, the shipping artery used by one-fifth of the world’s oil and gas supply, but the strait, which carries oil and petroleum products from Iraq, Saudi Arabia, Qatar, Kuwait and the United Arab Emirates, remains largely closed due to Iranian attacks on shipping after the U.S.-Israel attacks began on February 28.

Some vessels, however, including an Omani-operated tanker, a French-owned container ship and a Japanese-owned gas carrier, have passed through the strait since Thursday.

Meanwhile, major oil consumers, particularly in Asia, are conserving barrels or cutting consumption in response to the closure of the strait.

The Middle East supply disruptions have led refiners to seek alternative sources for crude, particularly for physical cargoes in the US and Britain’s North Sea.

Indian refiners have also postponed maintenance shutdowns of their units to meet local fuel demand.

On Sunday, the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) agreed to a modest rise of 206,000 barrels per day for May. However, this will only appear on paper as the disruption is limiting the ability of the top producers to add the needed output.

OPEC’s combined oil output losses for March were estimated at 7.2 million barrels daily. The biggest production cuts were made by Kuwait, Iraq, the United Arab Emirates, and Saudi Arabia, for a total OPEC output of 21.57 million barrels daily for March. This is the lowest OPEC production rate since June 2020.