S&P sees more ratings for Nigeria, Kenya

Standard & Poor's expects to rate a number of Nigerian banks this year and is talking to some Kenyan banks and companies about future credit ratings, its managing director for sub-Saharan Africa said yesterday. Borrowers across the continent are looking to tap international capital markets following successful bond sales by African countries. A long-awaited rating for Tanzania is not likely to be assigned any time soon, however, S&P's Konrad Reuss told a news briefing in London. "More Nigerian bank ratings will be coming out later this year ... we are working on a number of corporates in the region," Reuss said.

Borrowers in frontier markets such as Africa have turned to capital markets as aid funding dries up and monetary easing across the western world keeps interest rates low. A flood of new issues from sub-Saharan Africa in the past couple of years includes a recent debut dollar bond from Nigerian bank Diamond Bank. First Bank of Nigeria is holding a bond roadshow this week.

These bonds follow sovereign dollar debt issuance from Nigeria, which analysts say helped to familiarise investors with the West African economy. Kenya issued a well-received $2 billion dollar (Sh174 billion) bond last month. "We are reaching out to Kenya," Reuss said, referring to plans to discuss ratings with local banks and corporates in Kenya. "On the back of a very successful sovereign bond, a benchmark has been set."

Tanzania, which has also said it plans to launch a debut Eurobond, has not yet gained a rating. S&P officials said they were watching security issues in Nigeria and Kenya.