Banking
Moody’s Sees Vulnerabilities in This Tier Two Bank’s Asset Quality
**Says GTBank, Zenith Bank Strong to Withstand Shocks
By Modupe Gbadeyanka
Moody’s Investors Service has announced the downward review of the outlook of Sterling Bank Plc to negative from stable following the negative outlook on Nigeria’s government issuer rating.
In a statement issued this month, the rating agency said the lowering of Nigeria’s rating affects the bank’s credit profile as well as resulting in a lower ability to support the b3 BCA, which it said reflects Sterling Bank’s vulnerabilities in asset quality because of high single-name and sector concentration risks.
According to Moody’s, the lender has a large exposure to government debt securities and loans at 275 percent of its tangible common equity as of June 2019, noting that the company will likely be more exposed to negative pressure on its revenue generation capacity and its asset risk than its top-tier local peers due to its relatively small size and client base.
It was further stated that the b3 BCA shows bank’s modest capital levels, especially in light of high asset risks and high foreign-currency loans, stressing that these challenges are balanced against its deposit-based funding profile and stable local-currency liquidity, stating that the “local currency deposit rating is B2 while the local currency national scale rating is A2.ng.”
Also, commenting on other banks, Moody’s said Union Bank of Nigeria, FCMB and Fidelity Bank will likely be more exposed to negative pressure on their revenue generation capacity and asset quality than their top-tier local peers due to its relatively small size and client base.
For Union Bank, it said the b3 BCA reflects its high asset risks and low coverage of NPLs by provisions, which increases the risk of capital erosion in case of loan losses.
It further said this shows weak efficiency and moderate profitability; and still-tight, although improving, foreign-currency funding position, saying these challenges are moderated by the company’s stable deposit-based funding profile, particularly in local currency.
On the part of FCMB, it was stated that the b3 BCA reflects its elevated credit risks stemming from high single-name and sector concentrations; and relatively modest profitability levels compared with those of its top-tier local peers, noting that these challenges are balanced against its robust levels of tangible common equity compared with that of its global peers, stable deposit-based funding structure, and robust local-currency liquidity buffers.
For Fidelity Bank, the rating firm said the b3 BCA shows the lender’s relatively tight funding conditions, as reflected by its high, although improving, loan-to-customer deposit ratio; and high proportion of foreign-currency loans.
It said these challenges are mitigated by the lender’s relatively high provision coverage of NPLs; and solid capital buffers with a tangible common equity-to-risk-weighted asset that is comparable to global peers, although the bank’s capital buffer against the regulatory requirement is small.
But for Guaranty Trust Bank, Moody’s said b2 BCA reflects its resilient earnings generation capacity and robust capital buffers; high liquidity buffers and its predominantly deposit funded balance sheet; and robust franchise, which allows the bank to earn relatively higher margins and relatively low credit costs.
Also, it said Zenith Bank’s BCA of b2 reflects its resilient earnings generating capacity and robust capital buffers, which together provide a buffer to withstand asset-quality deterioration; high liquidity buffers and a predominantly deposit-funded balance sheet; and robust franchise, which allows it to attract inexpensive deposits, relative to other Nigerian banks, adding that “These strengths are moderated by the bank’s high proportion of more confidence-sensitive corporate deposits versus retail deposit.”
For UBA, it stated that the b2 BCA shows moderate asset risk profile, supported by its relatively more diversified loan book than that of its local peers; resilient profitability, which supports its capital buffers; and predominantly deposit-funded balance sheet, which is supported by a solid pan-African franchise, and strong local-currency liquidity buffers.
“These strengths are counterbalanced by UBA’s rising, although still moderate, dependence on confidence-sensitive funding,” the statement from Moody’s said.
Commenting on the b3 BCA of First Bank, the rating agency said it reflects the lender’s still-high stock of NPLs, although reducing, and moderate capital buffers, emphasising that these challenges are moderated by the bank’s resilient pre-provision profitability and stable funding profile, which is supported by a large stock of liquid assets.
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has warned banking customers to safeguard their financial information by never sharing their personal identification numbers (PINs), passwords, and other sensitive banking details with anyone.
The apex bank, in a post obtained from its X handle on Monday, advised customers as the world observes Global Money Week 2026 amid rising cases of fraud and scams targeting unsuspecting bank customers.
It emphasised that even individuals claiming to be bank officials should not be trusted with personal banking information.
“Protect your money by protecting your information. As we mark Global Money Week 2026, remember: your PINs, passwords, and banking details should never be shared with anyone, not even someone claiming to be from your bank. Stay alert. Stay safe.”
The warning comes amid worries as fraudsters often impersonate bank officials via phone calls, text messages, or emails to trick customers into revealing sensitive data. This has been made worse with the development of artificial intelligence (AI).
Global Money Week is an annual international campaign that promotes financial literacy, money management, and consumer protection. It is being observed worldwide, including in Nigeria, with a focus on safe banking practices.
This year’s theme, Smart Money Talks, focuses on supporting young people to talk openly about money, develop essential financial skills, and make informed decisions that build long‑term confidence and financial well‑being
Throughout Global Money Week, people and institutions will carry out programmes that will aid learning about the necessary money management skills, attitudes and behaviours needed to make smarter future financial decisions.
Topics like scams and fraud awareness, managing finances, understanding transactions and protecting consumer rights will also be explored across the world.
By Adedapo Adesanya
The Fintech Association of Nigeria has backed the recent slew of regulatory measures by the Central Bank of Nigeria (CBN), saying it will strengthen banking security, curb fraud and boost trust.
Mr Oluwaseun Adesanya, National Treasurer of the association, in an interview with the News Agency of Nigeria (NAN) in Lagos over the weekend, said the policies, including restricting banking applications to a single device, were designed to safeguard the financial ecosystem.
He said the regulator introduced the measures to improve security, protect customers and strengthen confidence in digital banking platforms.
Mr Adesanya, speaking on the sidelines of an induction and award ceremony organised by the Chartered Institute of Bankers of Nigeria (CIBN), said improved security will enhance convenience for customers and reinforce trust in financial institutions.
Mr Adesanya added the reforms would also help banks reduce losses from non-performing loans by strengthening credit facility frameworks.
“This will bring more sanity into the financial system and help banks avoid making provisions for loans that are no longer performing,” he said.
He noted that the regulatory initiatives were aimed at creating a safer environment for stakeholders across the financial services industry.
Last week, the CBN made some fresh regulatory moves aimed at strengthening the Nigerian banking ecosystem, including the announcement of new baseline standards requiring financial institutions to deploy automated anti-money laundering (AML) systems.
The new framework sets minimum standards for automated anti-money laundering solutions designed to strengthen the detection and reporting of financial crimes within Nigeria’s rapidly digitising financial ecosystem.
The CBN explained that the guidelines establish a baseline structure for financial institutions to deploy advanced monitoring tools capable of flagging suspicious financial activities instantly.
Also, it directed Nigerian banks to flag suspected fraud Bank Verification Numbers (BVNs) after a 24-hour watchlist from May 1, as well as updates on phone numbers linked to a BVN shall be allowed only once in a lifetime.
By Adedapo Adesanya
NOVA Bank Limited has announced the appointment of Jude Anele as its chief executive, following the approval of the Central Bank of Nigeria (CBN).
The appointment comes at a pivotal moment in the bank’s evolution, following its transition from merchant banking to commercial banking and the successful completion of its recapitalisation programme ahead of the March 31, 2026, regulatory deadline.
Mr Anele, according to a statement over the weekend, brings more than 33 years of banking experience across West and Central Africa, with deep expertise in retail/commercial banking, corporate banking, risk management, institutional transformation and executive leadership.
Over the course of his career, he has led complex banking operations, strengthened governance frameworks, delivered sustainable revenue growth and built high-performance teams.
The appointment reflects the board’s strategic commitment to consolidating NOVA Bank’s commercial banking platform while accelerating growth across its Corporate, Commercial and Retail segments, as well as priority markets.
Speaking on his appointment, Mr Anele said he was honoured to assume leadership of the Bank at a defining stage of its growth. “Nova Bank has built a strong institutional foundation defined by regulatory compliance, capital strength, disciplined governance and a clear commercial mandate.
“Our focus now is execution — deepening customer relationships, expanding responsibly across priority markets, strengthening risk discipline and delivering sustainable value to our shareholders,” he said.
On his part, the Bank’s Chairman, Mr Phillips Oduoza, also expressed confidence in the new leadership.
“The board is pleased to welcome Mr Jude Anele as Managing Director and Chief Executive Officer. His depth of experience, strategic clarity and proven leadership record align strongly with NOVA Bank’s growth ambitions,” Mr Oduoza said.
He added that with recapitalisation completed ahead of the regulatory timeline, the Bank is entering a new phase defined by scale, stability and structured expansion.
NOVA Bank also confirmed that it had met the recapitalisation requirements set by the CBN ahead of the regulatory deadline, reinforcing its capital adequacy and long-term financial stability.
The capital raise, supported by new and existing shareholders, further strengthens the Bank’s balance sheet and positions it for disciplined growth.
NOVA Bank currently maintains operations in Lagos, Abuja, Owerri and Port Harcourt, with plans to open eight additional branches across key commercial hubs in 2026 as part of its expansion strategy.
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