Banking
Moody’s Downgrades 8 Nigerian Banks
By Modupe Gbadeyanka
Renowned global rating firm, Moody’s Investors Service, has downgraded to B2 from B1 the long-term local currency deposit and issuer ratings of four Nigerian banks; Access Bank Plc, Guaranty Trust Bank Plc, (GTBank), United Bank for Africa Plc (UBA) and Zenith Bank Plc as well as the long-term local and foreign currency issuer ratings of Bank of Industry (BoI), a Nigerian development bank.
Moody’s also downgraded to B3 from B2 the long-term foreign currency deposit ratings of Access Bank, GTBank, UBA and Zenith Bank, as well as those of Union Bank of Nigeria Plc, First Bank of Nigeria Limited and Sterling Bank Plc.
In a statement issued by Moody’s last week, it said it concurrently downgraded the baseline credit assessments (BCAs) of Zenith Bank and GTBank to b2 from b1.
Explaining the reason for this, Moody’s said the rating action follows its downgrade of Nigeria’s government bond ratings to B2, with a stable outlook, from B1, with stable outlook, on November 7, 2017 and reflects the government’s reduced capacity to provide support to Nigerian banks in times of stress and the banks’ significant holdings of government securities linking their credit profiles to that of the government.
The decision to downgrade banks’ long-term foreign currency deposit ratings follows the downgrade of the relevant country ceiling for foreign currency deposits to B3 from B2.
Furthermore, it noted that the primary driver of the rating action is the weaker capacity of the government to provide support to banks, in case of stress, as reflected in the downgrade of the sovereign issuer rating to B2 from B1.
Subsequently, Access Bank’ and UBA’s long-term local currency deposit ratings and Bank of Industry’s long-term issuer ratings no longer benefit from a one-notch uplift from their b2 BCAs (or standalone credit profile, as is the case for Bank of Industry) as these are now at the same level as the government bond rating.
It noted that the long-term local currency deposit ratings of Sterling Bank, Union Bank and First Bank have been affirmed at B2, as their b3 BCAs continue benefiting from one notch of government support uplift.
In addition, it said the secondary driver of the rating action is the Nigerian banks’ significant holdings of government securities, which generally exceed 100 percent of their core capital, linking their credit profile to that of the government.
In view of the correlation between sovereign and bank credit risk, the banks’ standalone credit profiles and ratings are constrained by the rating of the government.
As a result, the BCAs for Zenith Bank and GTBank have been downgraded to b2 from b1, in line with the downgrade of the government issuer rating, despite the resilient financial performance witnessed by both banks over the last 24 months.
The BCAs of the other rated Nigerian banks have been affirmed as they already capture risks emanating from their sovereign exposures.
Moody’s said it could upgrade the ratings if the banks can demonstrate ability to contain non-performing loans while maintaining solid core profitability and capital generation could put upward pressure on the banks’ BCAs or lead to a stabilisation in the outlook in the case of First Bank.
“An upgrade of the banks’ global scale deposit and issuer ratings would be contingent on an improvement in the operating environment that translates to an upgrade of Nigeria’s sovereign rating.
“The ratings could be downgraded in the event of a further downgrade of the sovereign and/or if we assess that the government’s willingness to provide support in the future will decline below our current assumptions.
“The ratings could also be downgraded if we anticipate that a deterioration in the macro environment poses downside risks for asset quality and/or the capital generation capacity of the banks beyond what is already assumed in the ratings,” the rating agency disclosed.
By Adedapo Adesanya
The operating licences of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc have been revoked by the Central Bank of Nigeria (CBN) as part of efforts to strengthen the mortgage sub-sector and enforce compliance with banking regulations.
Mortgage banks are financial institutions that provide home loans and other housing finance products, and so, they are strictly regulated by the CBN to protect customers and ensure the stability of Nigeria’s financial system.
According to a post by the Acting Director of Corporate Communications of CBN, Mrs Hakama Ali, on the apex bank’s X handle on Tuesday, the affected institutions were accused of violating several provisions of the Banks and Other Financial Institutions Act (BOFIA) 2020 and the Revised Guidelines for Mortgage Banks in Nigeria.
The revocation is part of the central bank’s ongoing efforts to maintain a safe and reliable banking sector, protect customers’ deposits, and ensure that only financially sound institutions operate in the mortgage market.
“The breaches included failure to meet the minimum paid-up share capital requirement, insufficient assets to meet liabilities, being critically undercapitalised with a capital adequacy ratio below the prudential minimum, and non-compliance with directives issued by the CBN,” the post noted.
The CBN emphasised that the revocation aligns with its mandate to ensure financial system stability and maintain public confidence in the banking sector, assuring it is committed to promoting a sound and resilient financial system in Nigeria.
By Adedapo Adesanya
A five-member panel of the Supreme Court, led by Justice Lawal Garba, last Friday ruled in favour of Fidelity Bank in its appeal against Sagecom Concepts Limited.
The judgment brings definitive closure to a legacy case that has attracted attention across the financial sector for more than two decades. It also marks a significant victory for Fidelity Bank in a long-running legal dispute.
In a motion dated October 8, 2025, Fidelity Bank sought clarification from the Supreme Court, requesting a consequential order that the judgment debt be paid in Naira. The bank also asked that the interest rate be set at 19.5 per cent per annum rather than 19.5 per cent compounded daily.
It also requested the exchange rate used for conversion be the rate applicable as of the date of the High Court judgment, in line with the Supreme Court’s decision in Anibaba v. Dana Airlines.
Fidelity Bank further requested the judgment debt be fixed at N30,197,286,603.13 and that interest on this amount be payable at 19.5 per cent per annum until full settlement.
In the judgment delivered by Justice Adamu Jauro, the apex court granted the bank’s first three prayers but declined the fourth and fifth. As a result, the judgment sum will be paid in Naira at an annual interest rate of 19.5 per cent, rather than the daily compounded rate previously awarded by the High Court.
The Supreme Court equally affirmed that the applicable exchange rate should be the rate as of the date of the High Court judgment, consistent with its earlier decision in Anibaba v. Dana Airlines.
The dispute originated from a legacy transaction involving the former FSB International Bank, which merged with Fidelity Bank in 2005. It stemmed from a 2002 credit facility extended to G. Cappa Plc and subsequent legal proceedings tied to the collateral.
This ruling provides finality for years of litigation and confirms a significantly lower liability than the N225 billion previously speculated in the review of decisions leading up to the decision.
By Adedapo Adesanya
The operating licences of all legacy Bureau De Change (BDC) operators who failed to meet the new licensing requirements have been revoked by the Central Bank of Nigeria (CBN).
This happened after the central bank streamlined the BDCs to 82 in order to sanitise the foreign exchange (FX) market in the country.
The latest development was revealed by the apex bank in its Frequently Asked Questions document on the current reform of the bureau de change, published on its website on Tuesday.
According to the document, the CBN has now enforced the final cutoff, declaring that any BDC that did not meet the requirements by the end of November is no longer recognised.
“The guidelines provided a transition timeline of six months from the effective date, 3 June 2024, with a deadline of 3 December 2024, for all existing BDCs to meet the requirement of the new Guidelines or lose their licence(s). However, the management of the CBN graciously extended this deadline by another six months, which ended 3 June 2025, to give ample time for as many legacy BDCs desirous of meeting the new requirements to do so.
“Consequently, any legacy BDC that failed to meet the requirements of the new Guidelines as of 30 November 2025 has ceased to be a BDC, as its licence no longer exists. Please visit the CBN website for the updated list of existing BDCs in Nigeria,” the apex bank said.
According to the CBN, before its latest decision, an extended compliance window was granted under the revised BDC Guidelines. Existing operators were initially given six months, June 3 to December 3, 2024, to satisfy the new regulatory conditions.
The CBN later granted an additional six-month extension, which elapsed on June 3, 2025, to allow more operators to align with the updated standards.
The new measures form part of broader efforts by the CBN to strengthen transparency, compliance, and stability within Nigeria’s foreign exchange market.
The new CBN regulatory framework for BDCs, introduced in February 2024, mandated BDC operators to meet higher capital requirements. Tier-1 operators are required to meet a minimum capital requirement of N2bn, while Tier-2 operators must meet N500m as MCR.
The bank added that it would continue to receive applications on its Licensing, Approval and Requests Portal from prospective promoters, and those that meet the criteria will be considered for a license.
However, the CBN said it reserves the right to discontinue the licensing of BDCs at any time.
-
Feature/OPED6 years agoDavos was Different this year
-
Travel/Tourism9 years ago
Lagos Seals Western Lodge Hotel In Ikorodu
-
Showbiz3 years agoEstranged Lover Releases Videos of Empress Njamah Bathing
-
Banking7 years agoSort Codes of GTBank Branches in Nigeria
-
Economy3 years agoSubsidy Removal: CNG at N130 Per Litre Cheaper Than Petrol—IPMAN
-
Banking3 years agoFirst Bank Announces Planned Downtime
-
Banking3 years agoSort Codes of UBA Branches in Nigeria
-
Sports3 years agoHighest Paid Nigerian Footballer – How Much Do Nigerian Footballers Earn