InfraCredit Gets Agusto, GCR ‘AAA’ Long Term Credit Rating

Notwithstanding the unprecedented impact of the Coronavirus (COVID-19) pandemic on the domestic and global economic spheres, Infrastructure Credit Guarantee Company Limited (InfraCredit) recently received “AAA” credit rating from Agusto & Co (“Agusto”) and Global Credit Ratings (GCR),

In what is a reflection of its strong fundamentals and credibility, the “AAA” National Scale Rating, which is at par with Nigeria’s Sovereign, reinforces the unparalleled credibility of its unconditional irrevocable guarantees, the company said in a statement.

InfraCredit sustained its strong risk capital and broader balance sheet with significant headroom to underwrite further guarantees in pursuit of its mission of unlocking long term local currency infrastructure finance in Nigeria’s real sector.

The simultaneous rating, the statement added, partly reflects the support of its shareholders and capital providers including the Nigeria Sovereign Investment Authority (NSIA), Africa Finance Corporation, GuarantCo (a Private Infrastructure Development Group company), and reputed multilateral institutions, including KfW Development Bank, who are committed capital providers.

In addition, InfraCredit’s balance sheet and guarantee programmes are further supported under risk-sharing arrangements with the United States Agency for International Development (USAID), amongst other development finance institutions.

In arriving at its decision, Agusto was quoted as saying “the rating assigned to InfraCredit recognises its strategic importance and developmental role in the provision of local currency guarantees to enhance the credit quality of debt instruments issued to finance creditworthy infrastructure assets in Nigeria”. 

It added that “the assigned rating reflects InfraCredit’s quality guarantee and investment portfolios, backed by an acceptable risk management framework, good return on investments and an experienced management team”.

Similarly, GCR said “InfraCredit’s “AAA” rating, with a stable outlook reflects its operational uniqueness as a guarantee provider, strong ownership and management profile, demonstrated financial flexibility, strong liquidity position, and profitability track record so far.

“The asset quality (in terms of issued guarantees) is sound, with nil non-performing exposure recorded from inception till date”, GCR analysts added.

The statement noted that InfraCredit maintains the highest national scale rating accorded to any financial institution by Agusto and GCR, having recorded nil recourse on all its guarantee exposures since inception, thereby reinforcing the quality of its obligors, ingenuity of the financing structures and strong governance oversight.

Credited for its innovative approach to infrastructure financing, InfraCredit is creating capital access for infrastructure corporates in the real sector of the Nigerian economy whilst unlocking investable assets for pension funds, insurance firms and asset managers.

As the premier infrastructure credit guarantee company, InfraCredit expressed a commitment to its vision of playing a catalytic role in engendering market confidence and stimulating financial inclusion for real sector-induced growth and the sustainable development of Nigeria’s economy.

Reacting to the ratings actions, InfraCredit’s Managing Director/Chief Executive, Chinua Azubike expressed pleasure “with the simultaneous affirmations of InfraCredit’s “AAA” rating, with stable outlook, by the duo foremost credit rating agencies, Agusto and GCR.”

The assertion which follows thorough independent assessments by these reputed institutions, he continued, “Is a testament of our balance sheet capacity, impeccable quality of our guarantees and sound risk management practice.

“We would continue to adhere to global best practice in transaction structuring, governance, and market development, as we continuously strengthen our capitalization and broader capacity in pursuit of our vision to catalyze real sector growth through innovative infrastructure financing.

“Notwithstanding the challenges presented by the current COVID-19 pandemic, we continue to preserve our strong fundamentals, as we are committed to unlocking domestic credit to the private sector for infrastructure development that will create jobs and promote local economic growth,” he stressed.