{"id":24833,"date":"2022-08-29T07:19:50","date_gmt":"2022-08-29T07:19:50","guid":{"rendered":"https:\/\/www.africa-press.net\/ghana\/?p=24833"},"modified":"2022-08-28T20:06:31","modified_gmt":"2022-08-28T20:06:31","slug":"fitch-downgrades-three-ghana-banks-following-country-junk-rating","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating","title":{"rendered":"Fitch downgrades three Ghana banks following country junk rating"},"content":{"rendered":"

Africa-Press – Ghana. <\/strong><\/span>The economic woes of Ghana continues to deepen, as managers of the economy remain oblivious and take no responsibility. The President, Nana Akufo-Addo recently said his government couldn\u2019t be blamed for going to the International Monetary Fund to seek help for an economy that has been wrecked by his own government\u2019s bad decisions, poor judgement and borrowing too much for consumption.<\/p>\n

About a week ago, Fitch Ratings, one of the global ratings agencies which ratings are taken serious by international market players has downgraded three Ghanaian banks<\/a> to junk soon after downgrading the country.<\/p>\n

Fitch announced the downgrade of Ecobank Ghana Limited\u2019s, Guaranty Trust Bank (Ghana) Limited\u2019s (GTB Ghana) and United Bank for Africa (Ghana) Limited\u2019s (UBA Ghana) Viability Ratings (VRs) to \u2018ccc\u2019 from \u2018b-\u2018.<\/p>\n

The agency affirmed the Shareholder Support Ratings (SSRs) of Ecobank Ghana at \u2018ccc+\u2019 and of GTB Ghana and UBA Ghana at \u2018b-\u2018.\u201cThe Long-Term Issuer Default Rating (IDR) of Ecobank Ghana has therefore been downgraded to \u2018CCC+ from \u2018B-\u2018 while those of GTB Ghana and UBA Ghana have been affirmed at \u2018B-\u2018. The Outlook on the Long-Term IDRs is Stable,\u201d Fitch said, adding, \u201cFitch has simultaneously withdrawn Ecobank Ghana\u2019s ratings for commercial reasons and will no longer provide ratings and analytical coverage for Ecobank Ghana.\u201d<\/p>\n

According to Fitch, the rating actions follow the downgrade of Ghana\u2019s Long-Term IDR to \u2018CCC\u2019 from \u2018B-\u2018 on 10 August 2022. Days after Standard and Poor\u2019s downgraded Ghana to junk, Fitch also downgraded the country from B- to CCC. Fitch doesn\u2019t typically assign outlooks to sovereigns with a rating of CCC+ or below. A Fitch CCC rating is junk.<\/p>\n

According to Fitch, the downgrade reflects deterioration of Ghana\u2019s public finances, which has contributed to a prolonged lack of access to Eurobond markets, in turn leading to a significant decline in external liquidity.\u201cIn the absence of new external financing sources, international reserves will fall close to two months of current external payments (debits in the current account) by end-2022,\u201d it said.Among other things Fitch says following the downgrade of their VRs, the banks\u2019 Long-Term IDRs are now solely driven by the likelihood of extraordinary support from their parents, Togo-based Ecobank Transnational Incorporated (ETI: B-\/Stable) and Nigerian-based Guaranty Trust Bank Limited (GTB: B\/Stable) and United Bank for Africa Plc (UBA: B\/Stable).<\/p>\n

The Stable Outlook on the Long-Term IDRs reflects those on their parents\u2019 Long-Term IDRs. GTB Ghana\u2019s and UBA Ghana\u2019s Long-Term IDR is at the same level as Ghana\u2019s Country Ceiling of \u2018B-\u2018, which captures Fitch\u2019s view of transfer and convertibility risk within Ghana.\u201cFitch believes GTB and UBA to have a high propensity to provide support given the subsidiaries\u2019 importance to the parents\u2019 pan-African strategies and their substantial contribution to group net income. However, GTB\u2019s and UBA\u2019s ability to provide support is limited by their own creditworthiness, as expressed by their respective Long-Term IDRs,\u201d it said.<\/p>\n

However, on Ecobank Ghana\u2019s SSR of \u2018ccc+\u2019, it says, that reflects it\u2019s view that, although possible, extraordinary support from ETI cannot be relied on.\u201cFitch believes ETI has a high propensity to support Ecobank Ghana, reflecting the latter\u2019s strategically important role in the group as a key contributor to earnings and strong franchise in Ghana. However, ETI\u2019s ability to provide support, is constrained by the group\u2019s own creditworthiness and Ecobank Ghana\u2019s fairly large size relative to that of the group (11% of consolidated assets at end-1H22),\u201d it said.<\/p>\n

By Emmanuel K Dogbevi Copyright \u00a92022 by NewsBridge Africa All rights reserved. This article or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the publisher except for the use of brief quotations in reviews.<\/p>\n

For More News And Analysis About Ghana<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Ghana. The economic woes of Ghana continues to deepen, as managers of the economy remain oblivious and take no responsibility. The President, Nana Akufo-Addo recently said his government couldn\u2019t be blamed for going to the International Monetary Fund to seek help for an economy that has been wrecked by his own government\u2019s bad […]<\/p>\n","protected":false},"author":84,"featured_media":24832,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,3,7,8],"tags":[5092,5096,10078,429],"class_list":["post-24833","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-community","category-head-lines","category-homepage-english","tag-africa-press","tag-africa-press-ghana","tag-fitch","tag-ghana"],"yoast_head":"\nFitch downgrades three Ghana banks following country junk rating - Ghana<\/title>\n<meta name=\"description\" content=\"The economic woes of Ghana continues to deepen, as managers of the economy remain oblivious and take no responsibility. ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fitch downgrades three Ghana banks following country junk rating\" \/>\n<meta property=\"og:description\" content=\"The economic woes of Ghana continues to deepen, as managers of the economy remain oblivious and take no responsibility. ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating\" \/>\n<meta property=\"og:site_name\" content=\"Ghana\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2022-08-29T07:19:50+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/ghana\/sites\/18\/2022\/08\/postQueueImg_7-630bcab1e25b7.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"506\" \/>\n\t<meta property=\"og:image:height\" content=\"302\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/ghana\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Fitch downgrades three Ghana banks following country junk rating\",\"datePublished\":\"2022-08-29T07:19:50+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating\"},\"wordCount\":653,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/ghana\/sites\/18\/2022\/08\/postQueueImg_7-630bcab1e25b7.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Ghana\",\"Fitch\",\"ghana\"],\"articleSection\":[\"all news\",\"community\",\"head lines\",\"homepage-english\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating\",\"url\":\"https:\/\/www.africa-press.net\/ghana\/all-news\/fitch-downgrades-three-ghana-banks-following-country-junk-rating\",\"name\":\"Fitch downgrades three Ghana banks following country junk rating - 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