Agusto & Co. hereby assigns a ‘Bbb-’ rating to Jaiz Bank Plc, reflecting the Bank’s status as Nigeria’s largest non-interest bank with a growing footprint in its niche market.
The rating also considers Jaiz Bank’s good liquidity profile and adequate capitalisation. However, offsetting these positives are the Bank’s limited credit and market risk controls, high impaired financing ratio and high-cost profile.
The rating also takes into cognisance the impact of the COVID-19 pandemic on individuals and businesses as well as the limited availability of Shari’ah-compliant instruments which impedes effective liquidity management.
We have attached a stable outlook to the rating of Jaiz Plc. The outlook is hinged on our expectations that asset quality will deteriorate but will be slightly moderated by the CBN’s forbearance while capitalisation will improve in the short-term on the back of the scheduled capital raising exercise. We also expect the Bank to sustain its good liquidity profile and the growing footprint in its target market.