NCB Glob­al Fi­nance Lim­it­ed (NCBGF) has been af­firmed with a rat­ing of CariA (For­eign and Lo­cal Cur­ren­cy) on the re­gion­al rat­ing scale, and ttA on the T&T na­tion­al scale to from Caribbean In­for­ma­tion & Cred­it Rat­ing Ser­vices Lim­it­ed (Cari­CRIS).

Ac­cord­ing to Cari­CRIS these rat­ings in­di­cate that the lev­el of cred­it­wor­thi­ness of the NCBGF, in re­la­tion to oth­er oblig­ors with­in T&T and the Caribbean is good.

Cari­CRIS has al­so main­tained a sta­ble out­look on the Rat­ings. The sta­ble out­look is pred­i­cat­ed on Cari­CRIS’ ex­pec­ta­tion that NCBGF is well po­si­tioned to sus­tain their op­er­a­tions and sta­ble cred­it pro­file over the next 12-15 months.

More­over, Cari­CRIS ex­pressed that de­spite the like­ly neg­a­tive im­pact of the COVID-19 on eco­nom­ic ac­tiv­i­ty in T&T and the wider Caribbean re­gion, NCBGF is ex­pect­ed to re­alise con­tin­ued prof­itable op­er­a­tions in FY2020, al­beit at a re­duced lev­el.

As a mem­ber of the NCB Fi­nan­cial Group, one of the largest fi­nan­cial con­glom­er­ates in the re­gion, the re­port em­pha­sised that NCBGF has ac­cess to ad­di­tion­al cap­i­tal and fi­nan­cial sup­port if need­ed.

It said that the rat­ings of NCBGF re­flect­ed the com­pa­ny’s com­pet­i­tive ad­van­tage, which lies in its af­fil­i­a­tion with the NCB Fi­nan­cial Group, a lead­ing fi­nan­cial ser­vices provider in the re­gion.

Al­so sup­port­ing the rat­ings is the Com­pa­ny’s fi­nan­cial per­for­mance, which is sup­port­ed by con­tin­ued prof­itabil­i­ty and good as­set re­turns.

Cari­CRIS out­line that an­oth­er fac­tor sup­port­ing the rat­ings is NCBGF’s as­set qual­i­ty, which is con­sid­ered good and is char­ac­terised by a con­sis­tent­ly low Non-Per­form­ing Loans (NPL) ra­tio, which is well be­low that of the lo­cal in­dus­try.

In high­light­ing the fac­tors that could lead to an im­prove­ment of the rat­ings and/ or out­look of NCBGF, Cari­CRIS in­clud­ed the suc­cess­ful roll­out of the Com­pa­ny’s in­come re­bal­anc­ing strat­e­gy lead­ing to a greater con­tri­bu­tion to to­tal in­come from its Re­tail and Busi­ness Bank­ing Di­vi­sion to over 40 per cent and a re­duc­tion in the re­liance on in­sti­tu­tion­al fund­ing to un­der 50 per cent.

Cari­CRIS not­ed that an up­grade could be giv­en to NCBGF if the com­pa­ny records sus­tained in­creas­es in prof­itabil­i­ty of ten per cent over the next 3 years.

Ac­cord­ing to Cari­CRIS, the fac­tors that could lead to a low­er­ing of the rat­ings and/or Out­look in­clude two con­sec­u­tive years of de­clin­ing as­set yields or ris­ing fund­ing costs, lead­ing to a ma­te­r­i­al con­trac­tion in spread in­come to be­low 1 per cent.

NCBGF could al­so re­ceive a low­er rat­ing from Cari­CRIS if there is a sys­tem­at­ic in­crease in liq­uid­i­ty pres­sures in the en­vi­ron­ment, lead­ing to fund­ing with­drawals in ex­cess of 50 per cent from large in­sti­tu­tion­al in­vestors, and a wors­en­ing of short-term TT$ liq­uid­i­ty mea­sures over an 18-month pe­ri­od.

The rat­ing agency al­so main­tained that de­te­ri­o­ra­tion in the par­ent com­pa­ny’s cred­it rat­ing that could ma­te­ri­al­ly im­pact the ex­tent of cred­it sup­port avail­able to NCBGF, is al­so a fac­tor that could lead to a low­er rat­ing. (KR)