One of the frontline merchant banks in the country, Nova Merchant Bank Limited has earned a long-term “A+” rating with a stable outlook for the year 2021/2022 from DataPro, the technology-driven Credit Rating Agency (CRA).
In its latest report made available to The Nation, DataPro affirmed that Nova Merchant Bank Limited long-term rating “A+” indicates low risk and shows very good financial strength, operating performance and business profile when compared to the standard established by DataPro.
In the statement which reads in part, DataPro said, “The Bank in our opinion has a strong ability to meet its ongoing obligations. DataPro Rating Committee approved the rating after assessment of the Bank’s financial performance, governance risk, compliance as well as risk factors of its current healthy profile in the medium to long-term period. “
Besides, the Rating agency stated that, “The Bank’s share capital remained N16b (Yr. 21). However, the Bank’s equity grew marginally in 2021 by 3% from N22.7b (Yr. 20) to N23.5b (Yr. 21). Overall, the Bank’s assets grew by 34% from N182b (Yr. 20) to N242b (Yr. 21). This was largely driven by the increased loans and advances, pledged assets and balance with banks. The Bank also continued the steady growth of its deposit liabilities during the year under review. Deposit liabilities rose from N89.6b (Yr. 20) to N116.8b (Yr. 21). This was a growth rate of 30%. The growth was largely due to increased term deposits during the year. The rating of the Bank is supported by its strong capitalisation, good liquidity and very good asset quality.
“Previously, Nova Merchant Bank Limited had a Short-Term Rating of “A1” which indicates good credit quality and satisfactory capacity for timely payment of financial commitments. DataPro notes that the rating carries a maximum shelf life of 12 calendar months, in line with international best practice. The rating is therefore not an offer to trade in securities or a substitute for the user’s judgement. It is meant for reference purposes.”