Agusto & Co. upgrades the rating assigned to Providus Bank Plc to a “Bbb-”, with a stable outlook

Agusto & Co. upgrades the rating assigned to Providus Bank Plc to a “Bbb-”, with a stable outlook

Rating Release

Agusto & Co. upgrades the rating assigned to Providus Bank Plc to a “Bbb-”, with a stable outlook.

 The rating expires on 30 June 2022.

Agusto & Co. Limited upgrades the rating assigned to Providus Bank Plc (“Providus Bank” or “the Bank”) to “Bbb-” reflecting the Bank’s improving profitability, good liquidity position and strong shareholders’ support as demonstrated by the ₦4.8 billion deposited for additional shares during the year under review. Subsequent to the year end, an additional ₦6.5 billion capital was raised from shareholders to support the medium-term growth plans of the Bank. Providus Bank’s affinity with financial technology operators (FinTechs) which has supported the uptick in the Bank’s deposit base was also considered in the assigned rating. In the near term, we expect profitability to maintain an upward trajectory, the deposit base to expand further and the liquidity profile to remain good. We also expect capital to be sufficient for the business risks undertaken.

However, offsetting these positive rating factors are the Bank’s concentration in the loan book, its limited operating history as a commercial bank, adverse regulations and the slowly recovering economy after the outbreak of the COVID-19 pandemic.

This Rating Release is transmitted to you for the sole purpose of dissemination through your newspaper / magazine / agency. The rating release may be used by you in full or in part without changing the meaning or context thereof but with due credit to Agusto & Co.

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