• World
  • Columnist
  • Commodities
  • WORLD BUSINESS & ECONOMY
  • Executive Knowledge Series
  • Finance
  • Manufacturing
  • Markets
  • Risk & Governance
  • Small Business
  • Technology, Media & Innovation
  • Comments
  • Business AM WebTV
  • Login

Businessamlive
  • FRONTPAGE
  • FINANCE
    • AllAsset ManagementAuditBankingBondBudgetCapital MarketsC&I LeasingCurrencyDealDebt marketForexFund RaisingFundingGovernmentHedge FundsInsuranceInvestmentInvestorInvestor ServicesMergers & AcquistionsMoney marketTreasury BillsMortgagePensionsPersonal financePonziQuantitative EasingshareTaxationTSAWealth Management
      Finance

      Stringent regulations, business environment forced Stanbic IBTC out of BDC business

      January 15, 2021

      Finance

      Cautious equities trading see gains in Flour Mills, Mobil, Wapco push market cap to ₦21.09trn

      January 15, 2021

      Finance

      CBN issues guidelines for QR codes operation in Nigeria

      January 15, 2021

      Finance

      Global Equities: Positive sentiment buoys global markets’ performance on vaccine rollout, Biden confirmation

      January 13, 2021

  • MARKETS
  • ECONOMY
    • AllAfricaAgricAirportsAmericaAsiaAustraliaBreakthroughDealEuropeForeign InvestmentsforexGlobal marketGovernanceIMFMiddle EastNECANigeriaOutlookRich listSouth AfricaSport BusinessTradeU.KWest AfricaWorld Economic forum
      Technology

      Africa data centre market to outpace $3bn by 2025, says Turner & Townsend

      10 hrs

      Commodities

      Wheat soars as Russia considers export tax

      10 hrs

      WORLD BUSINESS & ECONOMY

      Only 20% of UK financial services professionals believe firms possess ethical commitment

      January 16, 2021

      Frontpage

      Moody’s sees negative 2021 outlook for sub-Saharan Africa, with severe economic challenges

      January 15, 2021

  • COMMODITIES
  • ENERGY
    • AllConferenceElectricityOil and GasPowerRenewable
      Frontpage

      NNPC receives $120.49m crude oil receipt in September  

      21 hrs

      Frontpage

      NNPC moves to rehabilitate downstream infrastructure, openscontract bids

      January 15, 2021

      Companies

      Ardova enters acquisition talks with Enyo as part of expansion drive  

      January 15, 2021

      Oil and Gas

      NNPC reaffirms commitment to OPEC+ agreement   

      January 15, 2021

  • TECHNOLOGY
  • MANUFACTURING
  • ANALYSIS
    • Analyst Insight

      CBN meeting and NSE in focus

      January 18, 2021

      Analyst Insight

      Once again, fiscal stimulus takes centre stage

      January 18, 2021

      Analyst Insight

      Organisations must learn from the WhatsApp story  

      January 18, 2021

      Analyst Insight

      Data privacy maturity model in organisations

      January 11, 2021

Frontpage Nigeria

Moody’s changes Nigeria’s ratings from stable to negative

December 5, 2019418 views0 comments

Moody’s Investors Service, one of the global credit rating agencies, Wednesday changed its outlook on Nigeria’s ratings to negative from stable.

Moody’s changes Nigeria’s ratings from stable to negative

Concurrently, Moody’s affirmed its B2 long-term local and foreign currency issuer ratings, the B2 foreign currency senior unsecured ratings, and the (P)B2 foreign currency senior unsecured MTN programme rating on the country.
According to the rating agency, the negative outlook reflected Moody’s view of increasing risks to the government’s fiscal strength and external position.

It explained: “Already weak government finances will likely weaken further given an extremely narrow revenue base and persistently sluggish growth that hinders fiscal consolidation.

Read Also:

  • Moody’s sees negative 2021 outlook for sub-Saharan Africa, with severe…
  • CBN issues guidelines for QR codes operation in Nigeria
  • Nigeria can generate 30,000MW of electricity by 2030, say GenCos
  • Positioning Nigeria’s agriculture as financial stronghold for AfCFTA
  • Nigeria’s railway e-ticketing platform launch set for next week

“As pressures mount, there is a risk that the government resorts to increasingly opaque and costly options to finance a moderate but rising debt burden.

“Moreover, vulnerability to an adverse change in capital flows is building in light of Nigeria’s increasing reliance on foreign investors to fund the country’s foreign exchange reserves.”

Furthermore, it pointed out that Moody’s decision to affirm the rating at B2 recognized a combination of credit strengths, including the country’s large and diversified economy supported by vast oil and gas endowments, notwithstanding persistent credit weaknesses such as its very weak institutions and governance framework and in particular poor public finance management.

“Concurrently, Moody’s has maintained Nigeria’s country risk ceilings at their current levels: Foreign Currency bond ceiling at B1, Foreign Currency deposit ceiling at B3, and Local Currency bond and deposit ceilings at Ba1.”
Moody’s also said the drastic reduction in Nigerian banks’ non-performing loans (NPLs) will help in reducing the risk of capital erosion from unexpected losses and lessens the need for loan loss provisions.

Nigerian banks’ NPLs reduced to 6.6 per cent at the end of October compared to the 14.1 per cent it was in 2018.
This was the first time the NPLs would drop to a single digit in the past 42 months.

But the rating agency’s banking analysts, Peter Mushangwe, in a note yesterday, described the development as credit positive.

“The Nigerian banking system’s non-performing loans ratio reduced to 6.6 per cent at the end of October from 14.1 per cent a year earlier, according to the central bank. This is credit positive, as lower NPLs reduce risk of capital erosion from unexpected losses and lessen the need for loan loss provisions. The improvement in asset quality is mainly due to banks’ growing loan books, write-offs and successful workout of exposures,” he stated.

Share on Facebook Tweet Email
Tagsbusinessamlive Nigeria Nigeria rating on Moody's Nigeria's ratings
PreviousEconomic uncertainties dragging UK car market down
NextNIMASA not aware of ship on Nigerian waters until 19 crew were kidnapped

Leave a comment

- Cancel reply

MARKET DATA

Market Videos

Recent Posts

  • Africa data centre market to outpace $3bn by 2025, says Turner & Townsend
  • Wheat soars as Russia considers export tax
  • Tizeti expands coverage to Edo, introduces low-cost unlimited 4G services
  • NNPC receives $120.49m crude oil receipt in September  
  • Sachet Culture: Fueling consumer buying behaviour or pollution?

World

Africa

Buhari, Okonjo-Iweala congratulate Adesina over reelection as AfDB President

Europe

EU businesses to cut investments in 2020, says EIB report

America

U.S. increases cost of visa application for Nigerians

Africa

Thatcher-Loving Nigeria Candidate Plans to Overhaul Economy

Africa

AfDB scales up industrialization pace on the continent, delivers improved business access to finance, skills, energy

Frontpage posts

0

Oil prices up $59 on tighter U.S. market, Middle East tensions

Frontpage October 18, 2017

1
2

Nigeria’s share index down 0.46% as investors swoop on Dangote Cement to take profit

Frontpage September 26, 2018

3

Nigeria’s debt service higher than desirable – Lai Mohammed

Frontpage December 30, 2019

4

Oil drops more than $1 after Saudi price cuts, demand optimism fades

Frontpage September 7, 2020

5

Telcos to Banks: Pay USSD debt or be disconnected

Frontpage November 28, 2019

SUPPORT

  • Photo Gallery
  • Help Centre
  • About Us
  • Accessibility

LEGAL & PRIVACY

  • Terms & Conditions
  • Privacy
  • Cookies
  • Copyright

SERVICES

  • Conferences & Events
  • Analysts Research
  • Advertising Rate
  • Ebooks

TOOLS

  • Portfolio
  • Newsletters
  • News feed
  • Currency Converter

SUBSCRIBE

Join us to get latest updates on business related news.

[mc4wp_form id="3076"]
  • ABOUT US
  • CONTACT US
  • CAREERS
  • TERMS & CONDITIONS
  • PRIVACY POLICY
Copyright 2017. All rights reserved. BusinessAMLive. A Businessnewscorp Member Company.