(Fitch Ratings released this statement )

Fitch Ratings-London-18 June 2014: Fitch Ratings has assigned Access Bank’s (Access; B/Stable) USD400m subordinated debt (Tier 2 notes) a final rating of ‘B-‘ and Recovery Rating of ‘RR6’. The notes, issued directly through the bank, have a coupon set at 9.25% and mature on June 24, 2021 with a five-year call option. The notes are part of the bank’s USD1bn GMTN programme.

KEY RATING DRIVERS
The notes are subordinated, but there is no contractual non-viability loss absorption such as coupon flexibility, principal loss absorption or equity conversion features. They qualify as Tier 2 regulatory capital under current Central Bank of Nigeria regulations. Fitch has rated the notes one notch below Access’s Viability Rating (VR) of ‘b’ to reflect below average loss severity for subordinated debt, relative to senior debt. No additional notches for non-performance risk have been applied.

RATING SENSITIVITIES
The notes’ rating is sensitive to a change in Access’s VR. In addition, the notching of the rating against the bank’s VR could also potentially widen if Fitch believed that the recoveries available to the subordinated noteholders would be lower than currently assumed.

Fitch Ratings