Fitch Ratings has downgraded Bank of Industry Limited's (BOI) Long-Term Issuer Default Rating (IDR) to 'B+' from 'BB-' and Support Rating to '4' from '3' following the downgrade of the Nigerian sovereign rating to 'B+' from 'BB-'.
The Outlook is Stable, in line with the Outlook on the sovereign.
The state-owned development bank BOI's ratings are driven by and equalised with Nigeria's sovereign ratings.
The Stable Outlook on BOI's Long-Term IDR reflects the Stable Outlook on Nigeria's sovereign rating.
BOI's Long-Term IDR is at the bank's Support Rating Floor (SRF) of 'B+', which considers Nigeria's ability to provide such support in a timely manner as and when required, as indicated by Nigeria's Long-Term Foreign Currency IDR of 'B+'.
Although the sovereign's ability has weakened, particularly in foreign currency, support would still be available to a limited extent, given BOI's relative size. We also believe that the state's propensity to provide support remains high, reflecting the state's 99.9% ownership, BOI's policy role and the bank's strategic importance to economic and industrial development.
BOI's funding is long-term and almost exclusively sourced from the Central Bank of Nigeria.