Agusto & Co. has assigned a “Bbb–“ rating to Mainstreet Microfinance Bank
The rating of Bank is underpinned by good capitalisation, good profitability, satisfactory asset quality, satisfactory liquidity profile and a stable management team. The rating is tempered by weak risk management practices around bank placements and manual loan approval and collection processes as well as a narrow funding base that restricts the ability of the MFB to effectively grow its loan book.
Mainstreet Bank Microfinance Bank Limited provides micro-financial banking services to the banking public.
Its products include enterprise loans, equipment loans, lease loans, local purchase orders, and Pay As You Earn loans. Mainstreet Bank Microfinance Bank Limited was formerly known as Afribank Micro Finance Bank.
The company was founded in 2009 and is based in Lagos, Nigeria. Mainstreet Bank Microfinance Bank Limited operates as a subsidiary of MainStreet Bank Limited.
Similarly, the rating agency has also rated Growth and Development Asset Management, GDL with BBB(IM)”.
Growth and Development Asset Management (GDL) is a company licensed by the Securities & Exchange Commission (SEC) to manage financial and non-financial assets (infrastructure) through collective investment.
Growth and Development Asset Management Limited, previously known as Express Discount Asset Management Limited (EDAM), is a wholly owned subsidiary of GDL Holding Company. GDL provides a variety of financial services including discretionary and non-discretionary portfolio management to retail and institutional investors; as well as client advisory services for high net-worth individuals.
The rating is supported by the Manager’s experienced and qualified decision making committees, well established process for generation of research output and active monitoring of operational events and transactions. The rating is, however, constrained by key man risk within the compliance unit and the relatively manual risk monitoring process.
The Fund is an actively managed open-ended collective investment scheme that invests in short-term, high-quality, naira-denominated instruments, including Treasury Bills, Commercial Papers, Banker’s Acceptances, Collateralized Repurchase Agreements, Certificates of Deposit, Deposits (Fixed/Tenured) with eligible financial institutions and Other instruments introduced and approved by the Central Bank of Nigeria (CBN) from time to time . To be eligible, a security generally must have received an investment grade rating from at least one recognized local rating agency registered with the SEC.
Also rated A+ is the Meristem Money Market Fund,a Fund that seeks to achieve its stated objective of delivering current income by investing 100 per cent of its assets in permissible instruments with a term to maturity at the date of acquisition of not more than 366 days.
The Fund also invests a minimum of 25 per cent of its assets in short-term securities issued or guaranteed by the Nigerian Government, and its portfolio maintains a weighted average maturity not exceeding 90 days.