Banking
GCR Affirms A-(NG) Rating on First Bank With Stable Outlook
By Modupe Gbadeyanka
Lagos Nigeria, 11 September 2017 — Global Credit Ratings has affirmed the national scale ratings assigned to First Bank of Nigeria Limited of A-(NG) and A1-(NG) in the long term and short term respectively; with the outlook accorded as Stable. The ratings are valid until August 2018.
RATING RATIONALE
Global Credit Ratings (“GCR”) has accorded the above credit ratings to First Bank of Nigeria Limited1 (“FirstBank” or “the Bank”) based on the following key criteria:
The ratings of FirstBank are supported by its established franchise and systemically important status, with likelihood of strong support from the Federal Government of Nigeria in the event that such support is required. Offsetting these key rating drivers is the Bank’s moderated profitability in recent years, primarily due to the level of loan impairment charges.
Asset quality remains a key rating concern, with the Bank’s gross non-performing loan (“NPL”) ratio escalating to 24.2% at FY16 (FY15: 17.8%). This was largely driven by rising delinquent loans, particularly within the troubled oil and gas sector, where the Bank remains highly exposed. While management efforts towards revamping the risk management framework and architecture are noted, additional impairment pressure is expected, as the exposure within the oil and gas sector remains substantial (constituting 38.6% of gross loans at 1H FY17), with the likelihood of offsetting the full impact of recovery efforts at FY17. Based on the unaudited results for 1H FY17, gross NPLs stood at 21.8% of total gross loans.
The Bank remains adequately capitalised reporting a risk weighted capital adequacy ratio of 17.8% at FY16 FY15: 17.1%), above the prudential threshold of 15%. The position is not expected to change imminently, given management’s muted loan growth prospects, with focus on organic growth through earnings accretion.
FirstBank has a robust funding structure, supported by its strong franchise, and diversified deposit book, though largely short-dated on contractual basis. Liquidity risk is considered low, with regulatory liquidity ratio of 52.7% at FY16 (for FirstBank Nigeria only), well above the prudential minimum of 30%.
The Bank’s exposure to foreign currency risk remains a concern. At FY16, about 51% of gross loans were denominated in foreign currency, the bulk of which remains within the troubled oil and gas sector. Additionally, exposure exists within borrowings and deposits. While FirstBank is taking necessary mitigating measures (including portfolio realignment), the volatility in the foreign exchange market remains a significant risk.
Although FirstBank’s net-interest income of N294.3bn stood above its peers, its bottom-line earnings were considerably weakened, due to high loan impairment charges. Thus, pre-tax profit remained low around N10.7bn (FY15: N9.7bn) in FY16, far below the peer average. According to management, the Bank will continue to enhance its risk management processes and operational efficiency in order to improve operating performance in the coming years.
While the challenging operating environment has heightened uncertainties across all forward looking scenarios, positive rating momentum is dependent on a rebound to strong asset quality and profitability, with markedly improved competitive positioning. Conversely, sustained negative trends in asset quality and profitability, coupled with a significant deterioration in the Bank’s liquidity and capital ratios could result in negative rating action.
1 First Bank of Nigeria Limited is the commercial banking group of FBN Holdings Plc. All figures are for the commercial banking group except where stated otherwise.
By Aduragbemi Omiyale
An initiative aimed to challenge business leaders and innovators to transcend current horizons has been introduced by Stanbic IBTC Bank through a thematic campaign known as There is Possible, Then There is More.
The idea is to a mindset of amplified possibility, sustained growth, and transformative partnerships, with Stanbic IBTC Bank positioned as a pivotal enabler.
With this campaign, Stanbic IBTC Bank is positioning itself as a trusted ally for Nigerian CEOs who want to do more, become more, and achieve more.
The Executive Director for Business and Commercial Banking at Stanbic IBTC Bank, Mr Remy Osuagwu, said, “As a bank, our mission is to not only meet the financing needs of Nigerian CEOs, but to inspire them to reach for more.
“We understand the challenges they face and the aspirations they hold, and we are equipped to support their ambitions, and extend them even further thereby, helping them to achieve exponential growth.”
He emphasised that, “This campaign is evidence of our commitment to being more than just a bank; we want to be the partner that propels our customers beyond their goals.
“We empower our clients with the tools and resources necessary for success by fostering collaboration and mutual growth and this proactive approach underscores our commitment to supporting business leaders and inspiring them to dream bigger and achieve greater heights in their respective industries.”
Business Post reports that the campaign officially debuted with a striking teaser, with An Open Letter to All CEOs on key digital platforms, digital out-of-home screens, and social media feeds. For days, the public speculated. This week, the letter was finally revealed—and with it, a most human and resonant message.
The Open Letter to CEOs is more than just an advertising creative campaign; it is a genuine call to action.
In it, Stanbic IBTC Bank acknowledges the resilience and achievements of Nigerian business owners even in the face of adversity. But it also dares to ask: What more could be achieved with the right support, partnership, and financial foresight?
Overall, Stanbic IBTC Bank’s vision reflects a deep understanding of the crucial role that financial institutions play in the broader economic ecosystem—one where banks serve as catalysts for growth and achievement.
From trade financing to investment advice, capacity development to transactional banking, Stanbic IBTC Bank offers a suite of solutions designed specifically to meet the evolving needs of today’s CEOs — from start-ups and SMEs to established corporations and multinationals.
By Adedapo Adesanya
The acquisition of the National Bank of Kenya by Access Bank Plc may linger a bit because securing the approval of the Central Bank of Nigeria (CBN) may be a challenge despite its Kenyan counterpart giving its blessings to the transaction.
Recall that on Monday, the Central Bank of Kenya (CBK) and the National Treasury approved the deal which will see KCB sell 100 per cent of NBK at 1.25 its book value to the Nigerian lender which had both signed an agreement for the purchase in March 2024.
Though the CBK has given its approval, the CBN also needed to authorise the acquisition for it to be completed.
Reports suggest the deal appears to have halted as the Nigerian apex bank flagged it for regulatory breaches and failure to receive proper notice.
It also said there were missing disclosures and a non-compliant structure and has asked both parties to resubmit the deal.
This development put a snag in Access Bank’s second acquisition in Kenya for the Nigerian bank after it bought Transnational Bank Limited in 2019.
Access Bank has plans to double the share of assets outside its home market by 2027 and has seen deal build on the bank’s growing operations in the Democratic Republic of Congo and Rwanda.
However, one of these may not happen as the CBN reportedly wants Access Bank to exit the Democratic Republic of Congo and shut down its London office as part of broader efforts to streamline Nigerian banks’ foreign operations.
Access Bank has been on a Mergers and Acquisition (M&A) streak across the continent, acquiring Grobank in South Africa, BancABC in Botswana and Mozambique, Diamond Bank in Nigeria, and Finibanco Angola in line with the visions of its late founder, Mr Herbert Wigwe.
It also has plans to buy Standard Chartered subsidiaries in Cameroon, The Gambia, and Tanzania (it has already completed acquisitions in Angola and Sierra Leone) as well as an 80 per cent stake in Finance Trust Bank (FTB) of Uganda which was announced in January 2024 and has gotten partial approval from Uganda’s financial authorities but has pending approval from the CBN and Bank of Uganda.
At the time of this report, both the CBN and Access Bank could not be reached by Business Post for comments on this development.
By Dipo Olowookere
Additional shares of First HoldCo Plc worth about N149.6 billion have been listed on the Nigerian Exchange (NGX) Limited.
The fresh equities were introduced to the stock exchange on Monday, April 7, 2025, to increase the total issued and fully paid-up share of the financial services provider to 41,877,841,591 ordinary shares of 50 Kobo each.
Before now, First HoldCo had a total of 35,895,292,792 ordinary shares of 50 Kobo each but this increased with the addition of another 5,982,548,799 ordinary shares of 50 Kobo each.
The new equities were from the rights issue of the organisation, which saw shareholders getting one new stock for every existing six stocks held at the close of business on Friday, October 18, 2024.
The exercise, which was oversubscribed by 25.46 per cent, was part of the strategies to meet the new minimum capital requirement of the Central Bank of Nigeria (CBN) for its banking business, First Bank of Nigeria Limited.
The banking arm of First HoldCo is in the tier one category in Nigeria and it is required to have at least N500 billion as its capital base because of its operations outside the country.
Business Post reports that the fresh 5,982,548,799 ordinary shares of First HoldCo listed on the bourse last Monday was at a unit price of N25, amounting to N149.6 billion.
Confirming this development, the NGX in a notice said, “Trading licence holders are hereby notified that additional 5,982,548,799 ordinary shares of 50 Kobo each at N25.00 per share of First HoldCo Plc were on Monday, April 7, 2025, listed on the daily official list of Nigerian Exchange (NGX) Limited.
The additional shares listed on NGX arose from First HolCo Plc’s rights issue of 5,982,548,799 ordinary shares of 50 Kobo each at N25.00 per share
“With the listing of the additional 5,982,548,799 ordinary shares, the total issued and fully paid-up shares of First HoldCo Plc have now increased from 35,895,292,792 to 41,877,841,591 ordinary shares of 50 Kobo each.”
-
Feature/OPED5 years agoDavos was Different this year
-
Travel/Tourism9 years ago
Lagos Seals Western Lodge Hotel In Ikorodu
-
Showbiz2 years agoEstranged Lover Releases Videos of Empress Njamah Bathing
-
Banking7 years agoSort Codes of GTBank Branches in Nigeria
-
Economy2 years agoSubsidy Removal: CNG at N130 Per Litre Cheaper Than Petrol—IPMAN
-
Banking2 years agoFirst Bank Announces Planned Downtime
-
Sports2 years agoHighest Paid Nigerian Footballer – How Much Do Nigerian Footballers Earn
-
Technology4 years agoHow To Link Your MTN, Airtel, Glo, 9mobile Lines to NIN