Banking

Fitch Upgrades Access Bank National Rating to ‘A+(nga)’

Published

8 years ago

01/02/2018

By Modupe Gbadeyanka

Fitch Ratings has affirmed Access Bank Plc’s Long-Term Issuer Default Rating (IDR) at ‘B’. The Outlook is Stable and at the same time upgraded the lender’s National Long-Term Rating to ‘A+(nga)’ from ‘A(nga)’. All other ratings have been affirmed.

The upgrade of Access’ National Long-Term Rating reflects Fitch’s view of an improvement in its creditworthiness relative to other rated Nigerian institutions. This considers continued expansion of the bank’s franchise and stable asset quality.

Access Bank’s IDRs are driven by the bank’s intrinsic creditworthiness as defined by its Viability Rating (VR). Access’ VR reflects solid financial metrics, which are stronger than most Nigerian banks.

Asset quality metrics compare especially well with its immediate peers. The bank’s stock of non-performing loans has remained under control, comprising 2.6% of gross loans at end-September 2017, the lowest of all large Nigerian banks. In our view, resilient asset quality reflects Access’ good corporate banking franchise and good management stability, including a robust risk management framework. A high Fitch Core Capital ratio (19.6% at end-September 2017) also provides a buffer against potential asset quality deterioration.

Asset quality has remained favourable despite challenging operating conditions in Nigeria, including tight liquidity in both local and foreign currency. Tight liquidity dates back to the sharp fall in oil prices, which has also adversely impacted asset quality sector wide.

Access’ VR also considers adequate profitability, albeit lower than the highest rated Nigerian banks. This reflects a larger cost base and Access’ modest retail franchise, resulting in a higher cost of funding than peers, although low loan impairment charges partially offset this. Access’ smaller retail franchise increases reliance on wholesale funding sources (as evidenced by its higher cost of funding). However, large cash holdings (22% of assets at end-September 2017) provide sufficient liquidity to mitigate this. The refinancing of the bank’s Eurobond in 2016 eased the bank’s foreign currency liquidity position.

Access’ National Ratings are a reflection of its relative creditworthiness to the best credits in Nigeria.

The long- and short-term ratings on Access’ senior unsecured programme have been affirmed at ‘B’. The long-term rating of senior debt issued under the programme has also been affirmed at ‘B’ with a Recovery Rating of ‘RR4’ indicating average recovery prospects.

The long-term rating on subordinated debt issued by Access is notched down once from its VR to ‘B-‘. This reflects higher loss severity compared to senior debt. The Recovery Rating has been affirmed at ‘RR5’, a lower expected recovery than senior debt issued by the bank.

Fitch believes that sovereign support to Nigerian banks cannot be relied on given Nigeria’s (B+/Negative) weak ability to provide support, particularly in foreign currency. In addition, there are no clear messages from the authorities regarding their willingness to support the banking system. Therefore, the Support Rating Floor of all Nigerian banks is ‘No Floor’ and all Support Ratings are ‘5’. This reflects our view that senior creditors cannot rely on receiving full and timely extraordinary support from the Nigerian sovereign if any of the banks become non-viable.

RATING SENSITIVITIES

IDRS, VIABILITY RATING AND NATIONAL RATINGS

Access’ IDRs are sensitive to rating action on its VR. Access’ VR is sensitive to a material weakening of liquidity. The VR is also sensitive to a sharp deterioration in asset quality that would erode capital and threaten the bank’s viability. This is not Fitch’s base case. An upgrade of the bank’s IDRs would require continued improvement in financial metrics to the level of the highest rated banks in the country. In particular, a material improvement in the bank’s funding structure in order to capture a greater share of stable low retail cost deposits would be credit positive.

Access’ National Ratings are sensitive to a change in its creditworthiness relative to other Nigerian banks.

The long-term and short-term ratings on Access’ senior unsecured programme are sensitive to any change in Access’ IDRs.

SUBORDINATED DEBT

The long-term rating on subordinated debt issued by Access is sensitive to any change in Access’ VR.

SUPPORT RATING AND SUPPORT RATING FLOOR

The SR is potentially sensitive to any change in assumptions around the propensity or ability of the sovereign to provide timely support to the bank.

The rating actions are as follows:

Long-Term IDR affirmed at ‘B’; Outlook Stable

Short-Term IDR affirmed at ‘B’

Viability Rating affirmed at ‘b’

Support Rating affirmed at ‘5’

Support Rating Floor affirmed at ‘No Floor’

National Long-Term Rating upgraded to A+(nga) from ‘A(nga)’

National Short-Term Rating affirmed at ‘F1(nga)’

Senior unsecured long-term rating affirmed at ‘B/RR4’

Senior unsecured short-term rating affirmed at ‘B’

Subordinated long-term rating affirmed at ‘B-‘/’RR5’

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Modupe Gbadeyanka

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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Banking

See Nigerian Banks That Have Secured Their Licences

Published

8 hours ago

19/01/2026

Business Post Contributor

Nigeria’s banking sector is in the midst of one of its most transformative periods in decades. In March 2024, the Central Bank of Nigeria (CBN) announced a new minimum capital requirement for banks, prompting them to raise additional capital by 31 March 2026. The goal? Create larger, more resilient banks that can support big projects, strengthen the financial system, and help drive Nigeria toward a $1 trillion economy.

It is important for everyday customers, investors, and businesses to understand that the new capital requirement is at different levels: International, National, and Regional.

Banks That Have Secured International Licences

An international banking licence allows banks to operate beyond Nigeria’s borders and engage in cross-border transactions. To qualify, banks must meet a higher capital threshold — ₦500 billion in paid-up capital.

As of early 2026, the following banks met this requirement and secured their international licences:

Access Bank Plc
Fidelity Bank Plc
First Bank of Nigeria Ltd
Guaranty Trust Bank (GTBank)
United Bank for Africa (UBA)
Zenith Bank Plc

Banks That Have Secured National Licences

A national banking licence allows operations across Nigeria but restricts international expansion. Banks need ₦200 billion in paid-up capital to secure this licence.

FCMB (First City Monument Bank) – currently pushing to raise additional capital to secure its international licence.
Wema Bank
Standard Chartered Bank (Nigeria)
Citibank Nigeria
Stanbic IBTC Bank
Sterling Bank
Globus Bank
Premium Trust Bank

Banking

VAT on USSD, Mobile Transfer Fees Not Introduced by Nigeria Tax Act—NRS

Published

4 days ago

15/01/2026

Modupe Gbadeyanka

By Modupe Gbadeyanka

The Nigeria Revenue Service (NRS) has denied reports that customers performing financial transactions would pay a Value Added Tax (VAT) of 7.5 per cent from January 19, 2026.

Information about this emanated from messages sent out to customers of a financial institution, informing them of the new development in compliance of Nigeria’s new tax laws, especially the Nigeria Tax Act 2025.

It was claimed that Nigerians, as part of efforts of the government to generate more funds from taxes, would begin to pay VAT for the use of banking services like USSD and others.

But reacting in a statement signed by its management on Thursday, January 15, 2026, the tax collecting agency emphasised that the VAT collection for such services was not new.

It stressed that customers have always paid taxes for electronic money transfers and others, as this is charged on the fee, not from the main amount of the transaction.

“The Nigeria Revenue Service wishes to address and correct misleading narratives circulating in sections of the media suggesting that Value Added Tax (VAT has been newly introduced on banking services, fees, commissions, or electronic money transfers. This claim is categorically incorrect.

“VAT has always applied to fees, commissions, and charges for services rendered by banks and other financial institutions under Nigeria’s long-established VAT regime. The Nigeria Tax Act did not introduce VAT on banking charges, nor (sic) did it impose new tax obligation on customers in this regard.

“The Nigeria Revenue Service urges members of the public and all stakeholders to disregard misinformation and to rely exclusively on official communications for accurate, authoritative, and up-to-date tax information,” the statement read.

Business Post reports that what this basically means is that if a customer sends N10,000 and the bank charges N50 for the service, a 7.5 per cent VAT on the N50, which is N3.75, would be paid by the sender, not N750, which is 7.5 per cent of N10,000.

VAT on banking fees

Banking

Paystack Enters Banking Space With Ladder Microfinance Bank Acquisition

Published

5 days ago

14/01/2026

Adedapo Adesanya

By Adedapo Adesanya

Nigerian-born payments company, Paystack, has announced its entry into the banking sector with the launch of Paystack Microfinance Bank (Paystack MFB) after the acquisition of Ladder Microfinance Bank.

The bank continues Paystack’s push into consumer products and adds a banking layer to its business-focused payment product, coming ten years after the company was founded with the goal of simplifying payments for businesses using modern technology.

In Nigeria alone, the company says its systems process trillions of Naira every month, supporting more than 300,000 businesses and millions of customers. According to Paystack, this growth highlighted a broader need beyond payments, prompting the decision to build a more comprehensive financial offering.

Paystack MFB will begin lending to businesses before expanding to consumers. It will also offer banking-as-a-service (BaaS) products to companies building financial products and treasury management products.

The company explained that while payments are a critical part of the financial journey, businesses and individuals increasingly require a full financial operating system. This includes the ability to store money securely, move funds easily, gain clarity from financial data, and access tools that support long-term growth. Developers, Paystack added, also need reliable, secure, and compliant infrastructure to build new financial solutions efficiently.

To address these needs, Paystack said it has established Paystack Microfinance Bank as a separate and independent entity from Paystack Payments Limited.

The new microfinance bank operates with its own license, governance structure, and product roadmap, although it will work closely with its sister company.

“By adding Paystack MFB to our family of brands, we’re finding the right balance through combining the rapid innovation of a tech-first platform with the stability of traditional banking,” said Ms Amandine Lobelle, Paystack’s chief operating officer.

Last year, it launched its controversial consumer payments app Zap, and now it is taking a step further with the company securing regulatory backing to become a deposit-taking institution. According to a statement, the bank will be guided by the same principles that shaped Paystack’s early success, including reliability, simplicity, transparency, and trust.

Paystack MFB has begun operations with a small group of early members and plans a gradual rollout to more businesses and individuals. The company also announced the opening of a waitlist for interested users and confirmed it is recruiting a dedicated team to help build its long-term banking infrastructure.