Moody’s upgrades Ecobank Outlook to Secure on stronger monetary efficiency

Moody’s Traders Service has affirmed the rankings of Ecobank Transnational Integrated (ETI), upgrading the outlook on its long-term issuer and senior unsecured debt rankings from adverse to secure, citing improved monetary efficiency and decreased refinancing dangers.

The company confirmed ETI’s B3/Not Prime long- and short-term issuer rankings, B3 senior unsecured debt score, b2 notional Baseline Credit score Evaluation (BCA), and b1 Adjusted BCA.

The change in outlook, Moody’s defined, displays ETI’s strengthened monetary fundamentals and its resilient efficiency throughout its widespread operations in 38 international locations, 35 of them in Africa, with complete property amounting to $28.9 billion as of March 2025.

A key issue behind the revised outlook is the rise in dividend inflows from ETI’s subsidiaries, which helped scale back double leverage and decrease refinancing danger. In 2024, ETI acquired dividends from 22 subsidiaries, up from simply 14 in 2021, marking a 22% rise in upstreamed revenue.

Moody’s additionally famous that ETI’s double leverage ratio, an indicator of liquidity danger ensuing from borrowing to fund fairness investments in subsidiaries, declined to 168% in December 2024, from 173% the earlier 12 months.

This, coupled with a profitable refinancing of short-term liabilities with longer-term funding, contributed to the improved liquidity profile on the holding firm stage.

ETI’s enhanced entry to capital markets additional helps Moody’s confidence. The group issued $400 million in senior unsecured notes in October 2024 and adopted up with a $125 million faucet issuance in Could 2025, each maturing in October 2029.

The outlook additionally incorporates Moody’s expectation that Ecobank Nigeria’s recapitalisation plan shall be finalised by the top of 2025 with minimal influence on group financials. According to this, ETI secured shareholder approval in Could 2025 to boost $250 million in Extra Tier 1 (AT1) capital, a part of which shall be directed to Ecobank Nigeria throughout Q3 2025.

Moody’s famous Ecobank Nigeria’s progress in lowering dangers, significantly by its current $150 million bond tender provide, which aimed to amend phrases of its $300 million February 2026 notes by eradicating the capital adequacy ratio covenant, a transfer that mitigates the chance of default in Nigeria that would set off cross-default clauses on the ETI stage.

Lastly, Moody’s reaffirmed ETI’s B3 long-term issuer rankings primarily based on its b2 BCA and b1 adjusted BCA, which features a one-notch uplift because of the average chance of help from key institutional shareholders. The company additionally acknowledged enhancements in asset high quality throughout the group in recent times.

General, the revised secure outlook displays ETI’s ongoing capital-raising efforts, bettering earnings profile, and enhanced danger administration, positioning the banking group on a firmer monetary footing.