Rating Release

The rating expires 30 June 2021

Agusto & Co. assigns a “Bbb+” rating to the Series II ₦6.2 billion 5-year fixed rate bond (‘the Issue’ or ‘the Bond’) of LAPO MFB SPV Plc (‘LAPO SPV’ or ‘the Issuer’). The Bond is part of the Issuer’s ₦20 billion debt issuance programme. The rating mirrors the standalone rating of LAPO Microfinance Bank Limited (‘LAPO MFB’ or ‘the Sponsor’) issued by Agusto & Co. Limited.

The rating assigned reflects LAPO MFB’s good capitalisation, dominant market position, experienced management team and, adequate liquidity and funding profile. The rating is, however, constrained by deficiencies in risk management processes, significant exposure to unrated financial institutions and high non-performing loans. The negative impact of the COVID-19 pandemic on the business activities and the weak macroeconomic environment are also rating concerns