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Comesa bank gets stable outlook

ADMASSU

PTA Bank president and CEO Admassu Tadesse during a past conference in Nairobi. PHOTO | DIANA NGILA | NMG

Strong capitalisation, adequate funding and liquidity and improved asset quality have earned Comesa bank a stable outlook.

Johannesburg-based agency, Global Credit Ratings (GCR), has affirmed national scale ratings of AAA (KE) and accorded a stable outlook to the Eastern and Southern African Trade and Development Bank (TDB) formerly known as PTA Bank.

GCR attributed the grade to the factors above and similarly, affirmed the bank’s long-term international scale foreign currency rating of BBB-, with a stable outlook. All the ratings are valid until September next year.

GCR said the potential of a downside movement in the national scale ratings is viewed as highly unlikely.

“The international scale long-term foreign currency rating (ISR) is supported by credit enhancement to callable capital through insurance cover provided by highly rated international counterparties.”

“Although the upside to the ISR is limited, downside pressure may stem from weakening shareholder support, deviation from mandate, downgrade of the bank’s insurance counterparties, reduced sovereign lending which in GCR’s view underpins the bank’s preferred creditor status, and the bank’s high risk concentration,” the agency said.

TDB was established in 1985, and is a multilateral treaty-based development financial institution and has 21 member states in the tripartite region (EAC, SADC and COMESA), two non-member states (China and Belarus - Paritetbank) and 13 institutions.

Its mandate is to finance and foster trade, regional economic integration and sustainable development, through trade finance, project and infrastructure finance, asset management and business advisory services.

TDB’s 2017 annual report shows that the lender recorded a net profit of $111.9 million (Sh11.19 billion), growing its profitability by 10 per cent from $101.5 million (Sh10.15 billion) in 2016.

Total assets grew by 23.4 per cent to close at $5.26 billion (Sh526 billion) from $4.26 billion (Sh426 billion).