Banking
S&P Downgrades Diamond Bank Ratings, Raises Alarm
By Dipo Olowookere
The long and short-term issuer credit ratings on Nigeria-based Diamond Bank Plc have been lowered by S&P Global Ratings, Business Post has learnt.
A statement issued by the rating agency disclosed that the ratings were downgraded to ‘CCC+/C’ from ‘B-/B’, with the outlook negative.
In addition, S&P said it also lowered its issue rating on the bank’s senior unsecured debt to ‘CCC+’ from ‘B-‘, with the long and short-term Nigeria national scale ratings on the bank dropped to ‘ngBB-/ngB’ from ‘ngBBB-/ngA-3’.
According to the statement, the rating action reflects Diamond Bank’s dependence on favourable business, financial, and economic conditions to meet its financial obligations.
“We believe that Diamond Bank will have to set aside higher provisions than we initially expected, following the adoption of International Financial Reporting Standard No. 9 (IFRS 9), which implies weaker asset quality than we expected and exerts significant pressure on the bank’s capitalization.
“Following Diamond Bank’s successful disposal of its West African subsidiaries, and imminent disposal of its UK subsidiary, we expect it will convert its license into a national banking license. The license conversion would mean a lower minimum capital adequacy ratio (10 percent versus 15 percent currently) and lower risk of breach.
“However, the timing is uncertain, and we consider that there is significant pressure on its capital position.
“Moreover, four of the bank’s 13 board members have resigned recently, which could create instability if left unresolved in the near term,” the statement said.
It was disclosed that as of December 31, 2017, the bank’s regulatory capital adequacy ratio reached 16.7 percent, dropping to 16.3 percent in September 30, 2018, on the back of IFRS 9 implementation and amortization of tier-2 capital instruments.
The initial implementation of IFRS 9 resulted in the bank taking N2.5 billion deduction from retained earnings at June 30, 2018.
S&P said it believes Diamond Bank will have to take higher provisions for IFRS 9, using the N31 billion of regulatory risk reserves that it holds under the local prudential guidelines.
“Based on peers’ experience and the bank’s weak asset-quality indicators, we estimate the impact will significantly exceed the regulatory risk reserves and estimate that our risk-adjusted capital (RAC) ratio will reach 3.4 percent to 3.9 percent in the next 12-24 months compared with 5.3 percent at year-end 2017.
“The impact will be somewhat tempered by the capital gain when the sale of the bank’s UK subsidiary is finalized. We expect the bank’s credit losses to average 5 percent over the same period, while nonperforming loans (NPLs; including impaired loans and loans more than 90 days overdue but not impaired) will remain above 35 percent in the next 12 to 24 months after reaching 40 percent at September 30, 2018.
“Overall, we think the bank will display losses in the next 12 to 24 months. In May 2019, Diamond Bank will have to repay its maturing Eurobond principal of $200 million. The bank plans to use its foreign-currency liquidity and the proceeds from the sale of its UK subsidiary for the repayment, among other sources.
“Any delays or unexpected developments could exert downward pressure on the ratings.
“Following the recent resignation of board members, the bank could face some outflows of deposits, but the granularity of its deposit base and its historically good retail franchise are mitigating factors,” the agency said.
It explained that the negative outlook reflects the pressure on the bank’s capitalization from weaker-than-expected asset-quality indicators, and on its foreign-currency liquidity due to a large upcoming maturity in May 2019.
“We could lower the ratings if provisioning needs proves higher than what we currently expect, leading to a decline in capitalization as measured by our RAC ratio (below 3 percent) or a breach in the local regulatory requirements.
“We could also lower the rating if the bank is unable to secure sufficient foreign-currency funding for the repayment of its Eurobond. When the latter is repaid, we may revise the outlook to stable if the banks’ asset quality and capitalization improves, and the make-up of its board stabilizes,” the statement said.
Business Post reports that shares of Diamond Bank rose by 3 kobo or 2.54 percent at the local stock market at the close of business on Wednesday.
By Aduragbemi Omiyale
A collaboration to enable fast money transfers into Nigeria has been entered into between Flutterwave and Xoom, PayPal’s international digital money transfer service.
The partnership allows Xoom transfers to be converted by Flutterwave and settled locally in Naira, enabling quick transfers directly into recipients’ bank accounts at Access Bank, UBA, Zenith Bank, First Bank, GTBank, and additional participating banks across Nigeria.
The deal also enables Xoom’s global network with Flutterwave’s local payout infrastructure, allowing users globally to send funds directly into Nigerian bank accounts with improved speed and efficiency.
Nigeria is the leading remittance recipient in Sub-Saharan Africa, receiving over $20 billion in personal remittances in 2024. Despite this volume, receiving international payments has historically remained complex due to FX constraints and settlement delays. This collaboration helps address those challenges in a market of more than 232 million people, where the ICT sector is projected to contribute 21 per cent of GDP by 2027.
By combining Xoom’s expansive reach with Flutterwave’s local compliance and banking partnerships, the two companies are providing a more accessible financial corridor for the continent.
Xoom, a PayPal service, is a fast and secure international digital money transfer service that enables consumers to send money, pay bills, and reload phones for friends and family in approximately 160 markets globally.
As part of PayPal’s global payments ecosystem, Xoom leverages advanced fraud protection, compliance capabilities, and a trusted global network to help millions of customers move money quickly and securely across borders.
“We’re excited to have been chosen by Xoom for their Nigeria expansion. Millions of Nigerians rely on money from abroad to support everyday needs, whether it’s families receiving help from loved ones, freelancers getting paid for their work, or individuals earning income from the global economy. This helps make it easy and more reliable for people in Nigeria to receive funds and stay connected to opportunities beyond borders,” the chief executive of Flutterwave, Mr Olugbenga GB Agboola, stated.
By Aduragbemi Omiyale
An initiative known as Nigeria Lightning Rounds, designed to expand funding opportunities for Nigerian startups and small businesses by connecting founders with local and international investors, has been launched by ProvidusUnity Bank, in partnership with US-based global venture firm and accelerator, gener8tor.
Scheduled to be held on July 15, 2026, Nigeria Lightning Rounds will feature carefully selected startups engaging with targeted investors who have expressed interest in supporting Nigerian innovation.
Participating founders will have the opportunity to pitch their businesses through focused 15-minute virtual sessions facilitated by gener8tor and ProvidusUnity Bank’s networks.
The program will focus on high-growth sectors including fintech, healthtech, manufacturing, sustainability, and AI, but welcomes SMEs from all industries, with intending participants urged to apply via https://www.gener8tor.com/lightning-rounds/nigeria.
“We recognise that access to capital remains one of the biggest challenges facing entrepreneurs in Nigeria. Through our partnership with gener8tor, we are creating a platform that connects promising Nigerian founders with investors who can provide the support required to scale their businesses,” the Head of Business Development at ProvidusUnity Bank, Mr Ernest Elue, stated.
“The partnership reinforces ProvidusUnity Bank’s commitment to strengthening Nigeria’s entrepreneurial ecosystem by supporting innovation, enabling access to opportunities, and creating pathways for businesses with high-growth potential,” he added.
Also commenting, the Director of Lightning Rounds at gener8tor, Ms Elizabeth Larios, said, “gener8tor is thrilled to partner with ProvidusUnity Bank to extend the Lightning Rounds model into Nigeria.
“This collaboration reflects our commitment to building equitable ecosystems and driving capital to the most promising and underrepresented entrepreneurs.”
Lightning Rounds are a signature initiative of gener8tor’s investment platform, which has facilitated thousands of investor-startup meetings globally. The format is optimised to eliminate friction, reduce bias in early-stage fundraising, and help founders secure capital from investors aligned with their mission and stage. gener8tor’s previous Lightning Rounds for Nigerian Founders in 2025 featured 18 participating Investors and led to 50 investment meetings facilitated.
By Modupe Gbadeyanka
The verification of the depositors of the 46 microfinance banks, whose operating licenses were revoked by the Central Bank of Nigeria (CBN) over a week ago, has commenced.
The exercise, aimed at refunding those whose funds were trapped in the small lenders, is being conducted by the Nigeria Deposit Insurance Corporation (NDIC).
In a statement on Thursday, the agency said its staff members have been positioned at the offices of the affected banks across the country to attend to depositors.
It was disclosed that depositors of the defunct banks, who had their Bank Verification Numbers (BVNs) linked to their accounts in the failed banks, will be paid through their alternative accounts in existing banks.
However, depositors whose BVNs were not linked to their accounts in the failed banks have been encouraged to visit the affected banks’ offices with proof of account ownership, a passport photograph, verifiable means of identification (Driver’s Licence, Permanent Voter’s Card, International Passport or National ID Card) and BVN.
NDIC also stated that depositors can alternatively file their claims online through its website: www.ndic.gov.ng, to complete the Pre-Verification Claims Form by clicking on the Search Bar, and typing Pre-Verification Claims Form; opening the Form and filling in their details. They can also do so by clicking the link: https://ndic.gov.ng/ndic-pre-verification-claims-form/ or by visiting any of the NDIC offices closest to them to file their claims.
For further enquiries, the corporation can be reached on any of the following lines: 09037273810, 09038197064, 08104220807, 09064657140.
