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Development bank of Rwanda earns B+ Fitch Ratings
Fitch Ratings has for the first time rated Development Bank of Rwanda at B+, reflecting the bank’s stable outlook. The rating also demonstrates BRD’s ability to raise external financing in case of need. Vincent Ngirikiringo, the bank's Chief Finance Officer joined CNBC Africa and shared an update on the 3 year $24.42 million recapitalisation plan by the government.
Thu, 14 May 2020 14:30:59 GMT
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AI Generated Summary
- The B+ Fitch rating aligns BRD with international standards, enabling diversification of its capital base for future expansion and funding strategic initiatives.
- Amidst the global pandemic, BRD swiftly supported affected customers through restructuring, showcasing resilience and commitment to aiding businesses during challenging times.
- The government's successful implementation of the recapitalization plan has strengthened BRD's capital base, enhancing its ability to finance development projects and attract strategic financial partners for future collaborations.
The Development Bank of Rwanda (BRD) has recently been rated by Fitch Ratings for the first time at B+, reflecting the bank's stable outlook. This rating showcases the bank's ability to secure external financing when necessary. Vincent Ngirikiringo, the bank's Chief Finance Officer, shared insights on CNBC Africa regarding the government's $24.42 million recapitalization plan over three years.
The B+ rating received by BRD mirrors the same rating as the government of Rwanda, highlighting the bank's alignment with international rating standards. This achievement positions BRD well to diversify its capital base in the future, enabling the bank to raise additional funds to implement its strategy, which is in line with the government's NST one strategy. Ngirikiringo expressed enthusiasm about the rating, emphasizing that it propels BRD towards the next level of strategy implementation.
Despite the global pandemic impacting various sectors, including infrastructure development— a key focus area for BRD—the bank swiftly responded to support affected customers. By collaborating with the government of Rwanda and the central bank, BRD facilitated restructuring for customers in need, enabling them to resume their operations smoothly. These efforts underscore BRD's commitment to aiding businesses during challenging times and showcase resilience amidst economic turmoil.
The B+ rating not only reinforces BRD's credibility but also plays a vital role in attracting strategic financial partners for future endeavors. The bank aims to diversify its capital base by inviting new shareholders and investors to inject capital. This increased confidence due to the rating paves the way for potential partnerships, facilitating the realization of development goals and enhancing investor trust in BRD.
Regarding the government's three-year plan to recapitalize BRD, significant progress has been achieved in the past year, despite the obstacles posed by the pandemic. Ngirikiringo commended the government's unwavering support, noting the successful implementation of the capitalization plan. With a strengthened capital base, BRD is well-positioned to expand its activities and effectively finance development projects in Rwanda.
Looking ahead, BRD remains committed to advancing development projects and infrastructure plans, despite potential delays caused by COVID-19. While some projects may experience setbacks, the bank is optimistic about overcoming challenges and continuing its efforts to drive growth and progress in Rwanda.
Reflecting on the financial results for the year ended December 31, 2019, Ngirikiringo highlighted a positive trajectory, with a significant 70% reduction in losses compared to previous years. This improvement underscores the collective effort of shareholders, management, and staff at BRD, signaling a commitment to sustainable financial performance and operational excellence.
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