Moody’s Investors Service has affirmed its long- and short-term issuer ratings for Ecobank Transnational Incorporated (ETI), assigning B3/Not Prime to both, alongside a B3 rating on senior unsecured debt, a b2 notional Baseline Credit Assessment (BCA), and a b1 Adjusted BCA. In a notable shift, the outlook on the group’s long-term issuer and senior unsecured debt ratings has been revised from negative to stable, signaling growing confidence in the bank's financial stability and strategic direction.

According to Moody’s, the upgrade in outlook reflects ETI’s resilient financial performance, its ability to upstream higher dividends from its subsidiaries, and the ongoing recapitalization of Ecobank Nigeria, all of which have contributed to lower refinancing risk and reduced double leverage at the holding company level.

ETI, which serves as the parent company of the Ecobank Group, has operations in 38 countries, including 35 across Africa, and held total assets of approximately $28.9 billion as of March 2025, the rating note revealed.

Key Drivers of the Revised Outlook

Moody’s analysts highlighted a number of positive developments that influenced the decision to revise the outlook:

  • Stronger Dividend Flows: In 2024, ETI recorded a 22% increase in dividend inflows, receiving payments from 22 subsidiaries, compared to just 14 in 2021. This has improved liquidity at the holding company and helped reduce reliance on external refinancing.

  • Successful Refinancing and Capital Initiatives: The group refinanced its short-term liabilities with longer-term funding in 2024, easing liquidity pressures. In May 2025, ETI secured shareholder approval to raise $250 million in Additional Tier 1 (AT1) capital, with a portion scheduled to be downstreamed to Ecobank Nigeria in Q3 2025 to support its capital adequacy.

  • Ecobank Nigeria’s Recapitalization on Track: Moody’s noted the group's confidence that the recapitalization of Ecobank Nigeria Limited will be finalized by the end of 2025 with minimal impact on ETI’s financials. The Nigerian subsidiary is also planning to raise $200 million in AT1 capital, further strengthening its balance sheet.

  • Bond Tender Success: Ecobank Nigeria recently completed a successful tender offer for $150 million of its $300 million February 2026 notes, and received consent to remove the capital adequacy ratio covenant from the bond terms. This move reduces the risk of a technical default, which could have triggered a cross-default clause at the ETI level.

Outlook and Future Expectations

“The stable outlook captures our expectation that a series of capital-boosting initiatives and actions to cure Ecobank Nigeria’s total capital position will be completed before the end of 2025,” Moody’s stated. Analysts also recognized ETI’s gradually improving profitability in 2024 and early 2025, which has helped moderate liquidity risks.

In the broader context, the revision signals increased market confidence in the Ecobank Group’s strategy to stabilize and strengthen its financial position amid evolving macroeconomic conditions across Africa. As ETI pushes ahead with its capital raising and consolidation efforts, Moody’s stable outlook offers a cautiously optimistic view of the bank’s trajectory.