Banking
S&P Affirms Fidelity Bank Ratings, Raises Concerns on High Loan Concentration
By Dipo Olowookere
One of the top rating agencies in the world, S&P Global Ratings, has announced affirming its ‘B-‘ long-term and ‘B’ short-term issuer credit ratings on Nigeria-based tier-two lender, Fidelity Bank Plc with a stable outlook.
In a statement issued last Friday and obtained by Business Post, the rating company said it was also affirming its ‘ngBB+/ngB’ Nigeria national scale ratings on the bank.
S&P explained that the affirmation reflects its view that the bank will display relatively moderate earnings compared with the sector average, as demonstrated in 2017, and relatively stable asset quality amid a slow economic recovery in Nigeria.
It noted that although an improvement in systemwide US Dollar liquidity–due to higher oil prices and increased oil and gas production–has eased the pressure on Nigeria’s manufacturing and trade sectors, some corporate entities still suffer from the effects of the foreign currency shortages over the past 24 months.
S&P stressed that the ratings reflect the lender’s modest size and position in the Nigerian banking sector, characterized by a high cost base and sizable funding costs, which have constrained it from competing with certain top-tier banks in terms of profitability.
Fidelity Bank’s regulatory capital adequacy ratio (CAR) declined to 16 percent at year-end 2017 from 17.2 percent in 2016, compared with the regulatory minimum of 15 percent. This was attributable to N15.2 billion (about $45.6 million) charge on capital for exceeding its single-obligor limit, and the amortization of its subordinated local bond.
The rating firm said it expects the single-obligor charge to drop over the next 12 months as the exposure is settled, and that the bank’s CAR will remain above the minimum requirement of 15 percent.
“We project that Fidelity Bank’s risk-adjusted capital (RAC) ratio before adjustments for diversification will decline to below 5 percent and range between 4 percent and 5 percent over the next 12-18 months, compared with 5.2 percent at year-end 2017,” the statement said.
The bank’s initial application of International Financial Reporting Standard (IFRS) No. 9 resulted in a N28 billion reduction in total adjusted capital as of March 31, 2018.
“Our projected RAC ratio takes into account our expectation of low double-digit loan growth, measured underwriting standards, and a naira depreciation, combined with the necessity for growth to counterbalance the decline in government securities.
“We also anticipate good fee and commission revenue generation (supported by the bank’s digitalization strategy) and a cost-to-income ratio of around 70 percent.
“Over the next 12-18 months, we forecast that the bank’s cost of risk will be higher than historical levels, at around the 1.5 percent posted at year end-2017, as it implements IFRS 9,” it added.
As of March 31, 2018, Fidelity Bank’s nonperforming loans (NPL) had declined to 6.3 percent of gross loans from 6.6 percent in 2016, while loan loss reserves accounted for a higher 110 percent of gross loans compared with 51 percent at year-end 2016.
The lower NPL ratio is mainly attributable to debt reduction in the upstream oil and gas sector, which the rating agency expects will continue over the next 12 months, while the higher coverage was due to the initial IFRS 9 application.
S&P said looking ahead, despite the higher expected coverage ratios, the bank’s high loan concentration and foreign currency exposures remain a concern; at year-end 2017, pointing out that the top 20 loans accounted for 59 percent of total loans and foreign currency lending for about 46 percent.
“Nonetheless, we see as positive that foreign-currency denominated loans are typically backed by receivables in the same foreign currency.
“Notwithstanding the relatively high cost of funding, the bank benefits from a stable funding base and adequate liquidity buffers, which compare well with peers’.
On December 31, 2017, the bank’s stable funding ratio was 112 percent and liquid assets covered short-term wholesale funding 6.9x.
“However, similar to other banks operating in Nigeria, Fidelity Bank’s deposit base is confidence sensitive, due to its contractually short-term nature.
“The stable outlook reflects our expectation that the bank will maintain its prudent underwriting standards, its CAR above the minimum regulatory requirement despite the IFRS 9 implementation, and adequate liquidity over the next 12 months,” it said.
S&P stressed that it could lower the ratings over the next 12 months if asset quality deteriorates by more than the sector average, and concentration risk materializes through a default of large exposures, adding that a positive rating action is unlikely in the next 12 months and would require a material improvement in macroeconomic conditions, coupled with stronger capitalization than it currently expects, with the RAC ratio sustainably exceeding 7 percent.
By Aduragbemi Omiyale
The chairman of Access Holdings Plc, Mr Aigboje Aig-Imoukhuede, has reaffirmed the organisation’s long-term commitment to shareholders, expressing confidence in the company’s strategic positioning, which he said is underpinned by disciplined execution, a diversified business model, a strengthened capital base, and a clear focus on sustainable value creation.
Speaking at the 4th Annual General Meeting (AGM) of the firm on Wednesday, he explained that the temporary suspension of dividend distributions was a consequence of regulatory compliance requirements rather than any deterioration in the group’s financial performance.
Mr Aig-Imoukhuede reaffirmed that the financial institution’s earnings capacity remains strong and that the board’s position reflects adherence to supervisory expectations and prudent capital management principles.
He assured shareholders of the board’s commitment to resuming dividend payments as soon as the relevant regulatory conditions are satisfied, noting that, “Our approach is clear: capital retained today must translate into greater value tomorrow and sustainable returns for our shareholders.”
The Chairman reiterated the strategic imperative underpinning the company’s next phase of growth, saying, “Our strategy, From Scale to Value, reflects the natural evolution of our journey. Scale created opportunity; value creation is how we fully realise it.”
He noted that while the organisation continues to generate strong returns, ensuring that earnings per share consistently exceed the cost of capital remains central to unlocking sustainable shareholder value.
The retired banker also acknowledged the significant unrealised value embedded within the firm’s international subsidiaries and reiterated management’s focus on improving market recognition of that intrinsic value over time.
Commenting on the financial performance of the group in 2025, he said Access Holdings accelerated provisions on legacy and regulatory forbearance credit exposures, resulting in elevated impairment charges.
He explained that the group consciously prioritised balance sheet strength and long-term resilience over short-term earnings optimisation.
“Periods of economic uncertainty often reveal more about an institution than periods of uninterrupted growth. Our focus remains on building a business that is not only growing, but improving in the quality, resilience, and sustainability of its earnings,” he stated.
Last year, the financial services organisation delivered pre-tax profit of N1.007 trillion, underscoring the strength of its diversified platform and expanding earnings base across key markets. Total assets increased to N51.56 trillion, while customer deposits grew strongly, reflecting sustained franchise momentum and deepening customer trust.
By Modupe Gbadeyanka
A new report highlighting the transformation from a newly established fintech venture into one of Nigeria’s leading payment infrastructure providers has been launched by HabariPay Limited.
The report, known as the HabariPay Impact Report 2025, provides stakeholders with a comprehensive evolution, innovation journey, business performance, and impact of the fintech subsidiary of Guaranty Trust Holding Company (GTCO) Plc on the digital payments landscape.
The company’s contributions to enabling digital commerce, supporting businesses, strengthening payment infrastructure, and expanding financial access through technology-driven solutions were also captured in the piece.
The HabariPay Impact Report 2025 also highlights the organisation’s strong financial and operational performance, the growth of the Squad platform, and the development of infrastructure that powers payment acceptance, switching, transfers, merchant services, and value-added solutions.
The publication further explores the role of innovation, talent development, and ecosystem partnerships in driving the company’s success.
It showcases HabariPay’s investments in innovation through initiatives such as the Take on Squad Hackathon and the Squad Hackademy, both of which are helping to develop future technology talent and accelerate the creation of practical solutions to real-world challenges.
“As a technology-driven company, we believe that impact extends beyond financial performance. It is reflected in the businesses we enable, the merchants we support, the infrastructure we build, and the opportunities we create for the next generation of innovators.
“The HabariPay Impact Report 2025 captures this journey and demonstrates our commitment to creating sustainable value for customers, partners, and the broader economy,” the Managing Director of HabariPay, Ms Eduofon Japhet, said.
“The HabariPay Impact Report 2025 represents more than a reflection on our achievements; it is a testament to the deliberate investments we have made in building sustainable payment infrastructure, empowering businesses, fostering innovation, and creating long-term value for our stakeholders.
“As we look ahead, we remain committed to expanding our capabilities, deepening our impact, and shaping the future of digital payments through technology-driven solutions that are secure, scalable, and inclusive,” she added.
By Modupe Gbadeyanka
Some top foreign exhibitors participating in the much-anticipated Ecobank Adire Lagos Experience commencing on Thursday, June 11, 2026, are already in Nigeria.
The four-day event, closing on June 14, will witness participation from notable African fashion brands from Ghana, Sierra Leone, Senegal and the Benin Republic.
Among the international exhibitors confirmed for this year’s edition are Creative Hub Africa and Shades of Class from Sierra Leone, Drame Khadidatou from Senegal, Tampoori from Ghana, and Naylah Collection from the Republic of Benin. Their participation highlights the growing continental appeal of the Ecobank Adire Lagos Experience as a platform for cultural exchange, business collaboration and market access across Africa.
More than 100 exhibitors and vendors, including leading Nigerian brands such as Obida Design Associates, This Is Us, Imani Kids, Ashabi Fads, E25Dresses, Miné by Ejiro Amos Tafiri, Buss Fabrics Store, Aina Aladire and many others, will participate, showcasing the richness of African craftsmanship, innovation and entrepreneurship.
It was gathered that organisers are putting finishing touches to the venue of the exhibition, the prestigious Ecobank Pan African Centre (EPAC) on Victoria Island, Lagos.
All necessary arrangements to ensure a seamless, secure and memorable experience for exhibitors and attendees are being put in place by the bank, further underscoring its commitment to promoting African creativity, entrepreneurship and intra-African trade.
The Head of SMEs, Partnerships and Collaborations at Ecobank Nigeria, Mrs Omoboye Odu, said attendees can look forward to a vibrant showcase of fashion, craftsmanship, art, music, culture and entrepreneurship, with participants drawn from Nigeria and several other African countries.
“We are fully prepared and excited to welcome guests from across Nigeria and the African continent to another edition of the Ecobank Adire Lagos Experience. From exhibition spaces and cultural showcases to networking opportunities and customer engagement activities, every necessary arrangement has been put in place to ensure a seamless and rewarding experience for all attendees,” she stated.
“The Ecobank Adire Lagos Experience continues to evolve as a unique platform that connects creatives, entrepreneurs and consumers from across Africa. Attendees can look forward to exceptional products, interactive sessions, entertainment, cultural exhibitions and valuable opportunities to build relationships, explore new markets and expand their businesses,” Mrs Odu added.
Beyond the exhibition, participants will have opportunities to network, explore business partnerships, discover unique products and experience the diversity and vibrancy of African culture.
The event is open to the public, and visitors can look forward to an immersive experience that seamlessly blends tradition, innovation, fashion, enterprise and entertainment in a grand celebration of Africa’s creative economy.
Over the years, the Ecobank Adire Lagos Experience has grown into one of Nigeria’s foremost platforms for promoting indigenous textile production, supporting small and medium-sized enterprises, and showcasing the ingenuity of African creatives.
The programme has also played a significant role in expanding market access for businesses while preserving and celebrating Africa’s rich cultural heritage.
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