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GCR Affirms Infrastructure Credit Guarantee Company Limited’s National Scale Long-term Issuer Rating of AAA(NG); Outlook Stable



Infrastructure Credit Guarantee Company - Investors King

GCR Ratings (“GCR”) has affirmed the national scale long term rating of AAA(NG) accorded to Infrastructure Credit Guarantee Company Limited, with a Stable Outlook.

Rated Entity Rating class Rating scale Rating Outlook
Infrastructure Credit Guarantee company Limited Long Term issuer National AAA(NG) Stable

Rating rationale

The rating is underpinned by the uniqueness of Infrastructure Credit Guarantee Company Limited’s (“InfraCredit” or “the company”) operations as a credit guarantee provider, and the company’s strong capitalisation, liquidity, and asset quality position, albeit counterbalanced by its self-regulated status.

Operational uniqueness offers some monopolistic privileges to InfraCredit, with no direct competitor in the country presently. However, the company reflects low level of diversification by product and customer base, and its operations are limited to Nigeria. Earnings growth was mainly fuelled by FX gains in FY20 as the COVID-19 pandemic impacted on finalisation of potential mandates. We expect the gradual normalisation in the economy to result in a material growth in earnings in FY21 and FY22 respectively post adjustment for FX gains. Management & Governance is a neutral ratings factor.

Overall capitalisation is a significant rating positive. A moderate negative adjustment was made due to the low core equity component of the qualifying tier-1 capital, with the GCR calculated core capital ratio standing above 20% at FY20 and year to date but expected to moderate to around 16-17% in FY21 and FY22. Revenue is considered stable, given the recurring nature and particularly the annuity-like nature of guarantee and monitoring fees, which are usually amortised and earned over the life of the guaranteed transaction, although counterbalanced by increased exposures to market sensitive income, which constituted 42.7% of total operating income in FY20 (FY19: 0.5%), thus constituting a moderate rating negative.

Risk is viewed to be somewhat contained through adoption of a stringent underwriting criteria. So far, there has been no payment default under any of the guaranteed transactions, hence no recourse to InfraCredit for repayment under any of its guaranteed transactions to date. However, note is taken of the concentrated nature of the deal portfolio (comprising four deals as at May 2021), which somewhat elevates the company’s risk profile. The USD denominated cash and liquid asset portfolio (bank balance, money market placements, Eurobonds) and due to related parties, and other financial liabilities also expose the company to foreign exchange risk, which appears to be well contained through hedging. Asset quality metrics are expected to remain sound in the foreseeable future.

Funding and liquidity is assessed at high level, with the funding base comprising mainly equity, preference shares, subordinated long term borrowings and contingent capital, all considered highly stable. Concentration risk inherent in the limited borrowing counterparties is offset by funding stability, with the unexpired tenor of the borrowings ranging from seven to nine years. The GCR calculated long-term funding ratio of 80% and 111% at FY19 and FY20 respectively is considered strong and expected to remain robust over the next 12-18 months.

Outlook statement

The stable outlook reflects GCR’s expectation that InfraCredit would ensure strong capitalisation characterised by significant core equity components, and maintain strong asset quality despite the expected rapid guaranteed portfolio growth and the strains in the operating environment.

Rating triggers

A rating downgrade could follow deterioration in asset quality, a downgrade in the ratings of any of the contingent capital providers, sustained pressure on earnings, as well a significant rise in leverage such that weakens the GCR total leverage ratio to below satisfactory level (less than 20%).

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Nasdaq,, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Nigeria’s Currency in Circulation Drops by 235% Due to Central Bank’s Redesign Policy



Godwin Emefiele - Investors King

The Central Bank of Nigeria (CBN) has reported a significant drop in the currency in circulation in the country following its redesign policy that plunged the nation into untold hardship.

The figures obtained from the CBN by Investors King revealed that N2.3 trillion was mopped up from circulation from October 2022 to February 2023, resulting in a 235.03% decline to N982.09 billion from N3.29 trillion reported at the end of October 2022.

The Governor of the CBN, Godwin Emefiele, had in October 2022, announced plans to redesign the old N200, N500 and N1,000 notes to address several challenges associated with currency management, including hoarding of banknotes, shortage of clean and fit banknotes, and increased risk of counterfeiting.

The CBN employed an “accounting/statistical/withdrawals and deposits approach” to compute the currency in circulation in Nigeria. This approach involved tracking the movements of currency in circulation on a transaction-by-transaction basis.

For every withdrawal made by a Deposit Money Bank (DMB) at one of CBN’s branches, an increase in the currency in circulation was recorded, and for every deposit made by a DMB at one of CBN’s branches, a decrease in the currency in circulation was recorded.

The apex bank said analysis of the currency in circulation showed that a large and increasing proportion of the naira outside the commercial banking system was held by the public who hoard a lot of the new banknotes.

At the expiration of the deadline for the old notes, due to the scarcity of the new naira notes, President Muhammadu Buhari approved the continued use of the old N200 as legal tender till April 10.

However, after some state governments sued the Federal Government over the naira redesign policy, the Supreme Court in its ruling on March 3 extended the legal tender status of the old N200, N500, and N1,000 notes to December 31.

The drop in the currency in circulation has caused some hardship to Nigerians, and the continued use of old notes as legal tender has been approved to ease the situation.

The CBN has ordered commercial banks to comply with the Supreme Court verdict and extend the legal tender status of the old notes.

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Npower Release Update on Failed Payment, Send Validation Link to Affected Beneficiaries




The management of Npower scheme, NASIMs has sent validation links to Npower batch C, Stream 2 beneficiaries. NASIMs noted that the link will be used to validate the details of beneficiaries with failed payments.

NASIMs had earlier stated that it noticed that some Npower beneficiaries are having issues with detail validation which has affected both their payment and status in the programme. 

NASIMs further added that an SMS link will be sent to all selected beneficiaries for the purpose of profile validation. 

It would be recalled that a significant number of batch C, Stream 2 Npower beneficiaries had taken to social media to complain of non-payment of their allowances after their colleagues had received theirs. 

Therefore, the validation message sent by NASIMs to Batch C, Stream 2 N-Power Beneficiaries read: “This is to notify you that we encountered issues validating the details you provided on your N-Power (NASIMS) profile. This could be due to an error in data entry or in the case of your bank account, invalid/inactive account.

Kindly use the link below to validate your BVN and account details to continue maintaining your status on the N-Power Program.”

However, Investors King gathered that if you have received your payment as Npower Batch C, Stream 2 Beneficiary, you do not need to validate your account again. 

The revalidation process is primarily aimed to rectify errors in payment issues for those who are yet to receive any payment. 

A check on the Npower platform further shows that affected beneficiaries will need to provide their Npower Identification Number, BVN and Bank Account to validate their details. This will ensure they received their backlog payment. 

If you have not received an SMS from Npower and you are one of the affected beneficiaries, you can however log on to to validate your details. 

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Digital Banking Startup Credable Raises $2.5 Million Seed Round to Expand Offerings



fintech - Investors King

Mumbai-based digital Banking Platform that is driving the future of banking by embedding financial services in businesses across emerging markets Credable, has raised a $2.5 million seed round to expand its offerings to emerging markets.

Speaking on the latest seed raised, the company’s CEO Nadeem Juma disclosed that Credable is seeking to offer banking services to the unbanked while planning to become the unit for emerging markets as it has rolled out plans to expand its offerings to large markets where the regulatory environment is conducive and businesses with profitable channels across MENAP and West Africa.

In his words,

“The problem we’re trying to solve is that a huge population of underbanked customers need banking services to improve their livelihoods. They are in different channels that they use every day, like telco-led mobile money, e-commerce platforms, and gig economy apps.

“Rather than try to create a new channel to bank these customers, we aim to enable these channels through a B2B2C offering that provides the customers with the banking services they need in the channels they’re already in.”

He further added that Africa’s most populous nations Nigeria, and Pakistan are at the top of its list of markets it seeks to expand its offerings.

Last May, Credable launched two products in East Africa, a 30-day term loan product in partnership with Vodacom M-Pesa in Tanzania and a short-term lending product for Diamond Trust Bank in Kenya.

The startup is committed to working capital and eradicating credit challenges faced by small and medium-scale enterprises (SMEs) in the new digital world. It aims to create inclusive growth for small businesses by providing them with cash management, payment, credit, and growth tools that will enable small business owners to efficiently grow and manage their businesses.”

Credable also hopes to address one financial malpractice which is predatory microlending, which typically involves imposing unfair and deceptive loan terms on end consumers.

Investors King understands that the startup handholds its business customers through product design, development, and management and works with them to ensure the product is relevant to its end consumers.

The platform syncs in with the existing accounting software and bank accounts of a business and provides real-time data that helps them make informed decisions to manage financial operations like collection and payments and avail instant, collateral-free access to working capital financing along with other growth tools.

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