Metropol is hosting a forthcoming webinar titled “Use of Ratings in Capital Raising and Pricing” on November 23, 2023, organized by Metropol Credit Rating Agency (MCRA), a unit of Metropol Corporation Limited.
The webinar (REGISTER HERE) will feature key speakers such as John Ngumi, Director, Investment Banking Coverage; East Africa at Standard Bank, Simon Rutega – Managing Partner, Diaspo Capital, and Manuel Moses – CEO at African Trade Insurance Agency.
Credit rating plays a pivotal role in Africa’s economic landscape. It serves as a crucial tool for investors and lenders to assess the creditworthiness of borrowers, be it individuals, corporations, or even countries. A good credit rating not only enhances the borrower’s reputation but also facilitates access to capital at competitive rates.
“Over time, companies that are seeking to raise money from capital markets through issuers of debt have faced challenges of long processes and pricing based on perceived risk. We believe that credit rating is a tool that can be used to fasten the process and also remove the element of perceived risk,” says Metropol Corporation Group Managing Director Sam Omukoko.
In the context of capital raising and pricing, credit ratings provide a standardized and objective measure of credit risk. They enable issuers to access a broader range of investors, reduce the cost of borrowing, and optimize capital structure.
For investors, credit ratings offer valuable insights into the relative risk associated with different investment opportunities, aiding in informed decision-making.
However, the credit rating landscape in Africa faces unique challenges. Limited financial transparency, regulatory hurdles, and market volatility can often lead to less-than-optimal credit ratings for otherwise promising entities.
“…many countries like Kenya, Nigeria and Rwanda already license credit rating agencies, with Kenya having four. But perhaps in demonstration of low self-confidence if there was ever such, the rating regulations did not envisage Kenyan licensed agencies conducting a sovereign credit rating. By its own regulation, Kenya has put itself at the mercy of very foreign licensed agencies it is complaining about!” says Ndiritu Muriithi – Economic Advisor at Metropol Corporation Limited in his Opinion Peace published on November 14, 2023.
Overcoming these challenges requires concerted efforts from all stakeholders, including governments, financial institutions, and credit rating agencies.
This webinar aims to delve into these issues, exploring the significance of credit ratings in capital raising and pricing in the African context.
We invite you to join us in this enlightening session and look forward to your active participation. Let’s work together to strengthen Africa’s financial ecosystem.