Rating Release
Agusto & Co. hereby affirms the “Bbb+” (long term) and “A2” (short term) ratings assigned to AB Microfinance Bank Limited with a stable outlook
The rating expires on 30 June 2026
Agusto & Co. hereby affirms the “Bbb+” (long term) and “A2” (short term) ratings assigned to AB Microfinance Bank Limited (“AB MFB”, or “the MFB”). The ratings reflect AB MFB’s good asset quality relative to other microfinance banks, experienced management team, good liquidity profile and support from a large microfinance group. However, the rating is constrained by the persistent threat to profitability and capitalisation posed by the significant exposure to foreign currency (FCY)-denominated technology support expenses, concentration in borrowed funds and high cost of funds driven by the MFB’s focus on costly tenored deposits. We have also considered the weak macro environment and the adverse impact on AB MFB’s target market and costs.
AB MFB is one of the nine national microfinance banks licensed by the Central Bank of Nigeria (CBN) and accounted for an estimated 1.3% market share of risk assets of the Industry as at 2024 FYE.
