OVERVIEW
Nigeria's economy has weakened more than we expected, owing to a marked contraction in oil production, a restrictive foreign exchange regime, and delayed fiscal stimulus.
Consequently, on Sept. 16, 2016, we lowered our long-term ratings on Nigeria to 'B' from 'B+'.
We believe that economic risks have increased for the Nigerian banking industry and that the government's propensity to support the banking system is now uncertain.
We are therefore taking various rating actions on the Nigerian banks that we rate.
RATING ACTION
S&P Global Ratings on Sept. 22, 2016 took various rating actions on the 9 Nigerian banks and one holding company it rates. For the complete list of rating actions, including those on the Nigerian national scale, please see the "Ratings List" section.
We lowered our long-term counterparty credit ratings on the following six Nigerian banks:
- Fidelity Bank PLC (FID), to 'B-' from 'B'.
- Zenith Bank PLC (ZNB), to 'B' from 'B+'.
- Guaranty Trust Bank PLC (GTB), to 'B' from 'B+'.
- Access Bank PLC (ABC), to 'B' from 'B+'.
- Stanbic IBTC Bank PLC (Stanbic), to 'B' from 'B+'.
- Ecobank Nigeria Ltd. (ECN) to 'B' from 'B+'.
- First City Monument Bank (FCMB), to 'B-' from 'B'.
We have a negative outlook on ECN. Our outlook on the other five banks listed above is stable.
For the above banks we have, where appropriate, also lowered all issue ratings by one notch.
We also affirmed our 'B-/C' long- and short-term counterparty credit ratings on FirstBank of Nigeria Ltd. (Firstbank) and FBN Holdings PLC (FBN). We removed these ratings from CreditWatch negative where we had placed them on June 22, 2016. The outlook is negative.
Our 'B-' long-term counterparty credit rating on Diamond Bank PLC (DB) remains on CreditWatch with negative implications, where we placed it on June 22, 2016.
