Agusto & Co assigns “Aa-” rating to Access Bank

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NIGERIA’s credit Rating Agency, Agusto & Co has assigned “Aa-” rating to Access Bank Plc. The rating assigned to the bank reflects its good profitability and liquidity, as well as the experienced and stable management team.

This is in addition to a good brand franchise, buoyed by strong market share, following the 2019 merger with Diamond Bank Plc, which lifted its industry position within the Tier I bank category. Access Bank Plc’s performance over the years has been reflective of a dedicated strategy to expand its scope of offerings and become a global payments gateway, facilitating transactions not just within Nigeria and across Africa, but between Africa and the rest of the world.

This appetite for expansion has spurred internal initiatives to grow the bank’s business both organically and through mergers & acquisitions. The challenges faced by Access Bank have, however, largely bordered on funding costs and operating expenses – both elevated, thus constraining margins vis a vis industry peers.

Having acquired scale, Access Bank needs to demonstrate efficiency, particularly in view of its stronger pool of low-cost retail deposits. In addition, asset quality challenges, following the merger with Diamond Bank Plc, alongside the adoption of IFRS 9 principles have also put some pressure on capitalisation.

– July 5, 2019 @ 16:19 GMT |

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