VENTURES AFRICA – Global ratings organization Fitch has upgraded the long-term Issuer Default Rating (IDR) of Access Bank Nigeria to B from B-, and the bank’s national long-term rating to A- from BBB-.
This is coming at a period of financial crisis in the European Union which has led to the downgrade of the ratings of some of the largest banks in the world including Bank of America, JP Morgan Chase and Goldman Sachs.
The upgrade is a reflection of the resilience of Access Bank and Nigerian banking sector which has recently come under thorough scrutiny by the Central Bank of Nigeria (CBN).
It also reflects Fitch’s view of the improved systemic importance and enhanced franchise of Access Bank, after it absorbed Intercontinental Bank Plc – an acquired rescued bank.
According to a research note released by Renaissance Capital (Rencap) earlier in the year, Rencap notes that, “Access Bank appears to be ahead of the curve in its integration of Intercontinental Bank.”
Following the acquisition of Intercontinental Bank, the combined consolidated entity (Access and Intercontinental) at the end of 2011 now controls about 8.5 percent of industry assets. With that, Access Bank has risen to become the third largest Nigerian bank by assets. Thus, increasing competition in an already fierce retail market in Nigeria.
In May this year, The Banker Magazine, a member of the Financial Times stable of publications, selected the Access Bank and Intercontinental Bank deal as the “2012 Mergers and Acquisitions Deal of the Year” for Africa.