Sterling Bank Plc has been assigned a B2 stable rating by an international rating agency, Moody’s, for its resilient deposit funding base and stable local currency liquidity.
The rating was also informed by the bank’s improvement on its Information Technology (IT) infrastructure and risk management processes.
The rating agency has also assigned a national scale local currency deposit rating of A1.ng/NG-1 and a Counterparty Risk Assessment (CRA) of B1.
It noted that Sterling Bank’s strength is balanced against Nigeria’s challenging operating environment, which takes into account the strong growth potential of the system, institutional and structural weaknesses and low foreign currency liquidity buffers.
Others are the vulnerabilities in asset quality on account of high single-name and sector concentration risks and modest capital levels, especially in the light of the bank’s high oil and gas and foreign currency loans exposure.
Sterling is a domestic bank with a market share of total assets of around 2.6 per cent (N834.2 billion, $2.6 billion, FY2016) with a national commercial banking licence.
Its banking services emphasises on consumer/retail banking, trade services, commercial and corporate banking activities.
The bank operates through 180 branches in Nigeria, with over 800 ATMs and was established in 2006 following the merger of NAL Bank, Indo-Nigeria, Magnum Trust Bank, NBM and Trust Bank of Africa.
The rating agency remarked that all long-term ratings assigned to Sterling carry a stable outlook, reflecting its expectation that the bank’s deteriorating asset quality and profitability metrics will likely stabilise in the next 12-18 months.
Moody’s Investors Service, often referred to as Moody’s, is the bond credit rating business of Moody’s Corporation, representing the company’s traditional line of business and its historical name. Moody’s Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor’s and Fitch Group, is considered one of the big three credit rating agencies in the world.
These include government, municipal and corporate bonds; managed investments such as money market funds, fixed-income funds and hedge funds; financial institutions, including banks and non-bank finance companies; and asset classes in structured finance.
In Moody’s Investors Service’s ratings system, securities are assigned a rating from Aaa to C, with Aaa as the highest quality and C the lowest quality.
Moody’s was founded by John Moody in 1909 to produce manuals of statistics related to stocks and bonds and bond ratings.
Sterling Bank recently emerged as one of the best banks in Nigeria in international trade cash payment from Deutsche Bank AG of Germany.
The bank emerged second runner-up in the 6th edition of the Straight Through Processing (STP) Excellence Award 2016/2017 Dinner in Lagos.
Mr. Harold Leenen, managing director, GTB Head Middle East & Africa of Deutsche Bank presented the award to Mr. Yemi Odubiyi, executive director, Operations & Services and Mr. Ayodele Ogumeru, group head, Trade Services, both of Sterling Bank.