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Nairaland Forum / Nairaland / General / Business / Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 (14011 Views)
Bad News For Nigeria As Moody’s Downgrades First Bank, Access Bank, GTB, Others / IMF Downgrades Nigeria’s Growth Forecast For 2017, Says Recession Over Next Year / Fitch Downgrades Credit Ratings Of First Bank, UBA- The Vanguard (2) (3) (4)
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by phreakabit(m): 8:32pm On May 01, 2016 |
[size=18pt]"judged to have speculative elements and a significant credit risk”[/size] Buhari well done oh! Even our credit rating don crash self. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Nobody: 8:32pm On May 01, 2016 |
hmmmmmmmm |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by bookface: 8:34pm On May 01, 2016 |
Here is a simple explanation. Imagine that both you and Dangote - approach a bank to borrow some funds. You bank manager is likely to attend to Dangote first because he is deemed to have low credit risk, by contrast you are deemed to have a high credit risk, because you be "I never chop". Additionally, you manager will probably charge Dangote 2% interest, while they charge you 25% interest. The same thing here - when a country is in good and sound economic position, that country is deemed to have good fundamentals and low credit risk and therefore has a good credit rating. Therefore when the country approach international bond markets to borrow money, the cost is lower. If the Nigerian government wants to borrow money in the bond markets for 10 years as of today, it would cost the government about in 15% interest. While a country like the UK government will probably pay 0.5%. As a matter of fact, a country like japan currently have negative interest rates. i.e you pay the Japanese government to lend them money. The best rating a country can have is Aaa, while the worst rating is a D. Countries with good ratings may sometimes have their currencies considered as safe-haven currency for example US dollar and Swiss franc . Although that may not always be the case, for example in a place like Australia or Canada due to their exposure to commodity prices. Anyway, the effect of this downgrade is likely not going to be anything drastic as the market as already priced all of this in. The medium/ longer term effect is increased cost of borrowing and a downward pressure on exchange rates. 9 Likes 3 Shares |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Adesiji77: 8:35pm On May 01, 2016 |
Wizdray: "Moody's" is the short name of Moody's Investors Service one of the international credit rating agencies that ranks the creditworthiness of borrowers using a standardized ratings scale which measures expected investor loss in the event of default. You may also come across Standard & Poor's and Fitch Group. Together with Moody's, they are referred to as the Big Three credit rating agencies. 2 Likes 1 Share |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Litmus: 8:37pm On May 01, 2016 |
and i thought Moody’s was a Japanese porn company ![]() 1 Like |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by menxer: 8:37pm On May 01, 2016 |
This is what wailers never want to hear, Moody why na? |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by numtums(m): 8:44pm On May 01, 2016 |
Who's gonna make me understand this? |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by gurunlocker: 8:44pm On May 01, 2016 |
So Nigeria waec result don come out, dem fail... Time to start reading again against next exam. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by yomalex(m): 8:46pm On May 01, 2016 |
If you watched the film 'Big Short' you'll just laugh about it |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Nobody: 8:53pm On May 01, 2016 |
yinchar: ![]() |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Epukaa: 8:56pm On May 01, 2016 |
yinchar: Once we agree to take IMF loan, all of them will upgrade us to A++. No mind them. Parasitic Western allies at work. 3 Likes |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by kolaaderin: 8:57pm On May 01, 2016 |
lalasticlala: Moody I know is a music streaming software....... May I know why Bs are changing forms. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by BuddhaPalm(m): 8:59pm On May 01, 2016 |
surestsam: They're just moody - das all. 1 Like |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by magicminister: 9:11pm On May 01, 2016 |
735i: It also implies that the federal government is more prone to defaulting on its debts. This also affects investors in Nigeria especially does investing in bonds, t-bills and other government issued investments! |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by imsuboi(m): 9:24pm On May 01, 2016 |
yinchar: Zombie ![]() 2 Likes 2 Shares |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Nobody: 9:35pm On May 01, 2016 |
Moody, na now una wake up? Something wey I don downgrade since, una de downgrade now ![]() |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Firefire(m): 9:39pm On May 01, 2016 |
Moody, S&P and the likes can go to hell with their baseless rating, now making borrowing more costly for the country with resultant effect on her citizens. We have lost confidence in a rating that have no clear base judgment. / Since ratings involve judgments about the future, on the one hand, and since they are used by investors as a means of protection, on the other, the effort is made when assigning ratings to look at "worst" possibilities in the "visible" future, rather than solely at the past record and the status of the present. Therefore, investors using the rating should not expect to find in them a reflection of statistical factors alone, since they are an appraisal of long-term risks, including the recognition of many non-statistical factors. In another development: S&P cut its outlook for China’s sovereign credit rating to negative from stable, but maintained the rating at AA-, saying the government’s reform agenda is on track but likely to proceed more slowly than expected. We got alternative to this western agency rating. 1 Like |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Jymsyno2004yahoocouk(m): 9:40pm On May 01, 2016 |
Its a bad result for naija. Bonds are classified into 3 categories. The highest grade is called investment grade,intermediate grade is speculative which naija has dropped into and the last grade is junk bonds. What this means is that buying fed govt of naija bonds now is speculative. To a lay man's term like gambling or like buyin shares which can go up or down. The b1, b2 etc are the levels of gambling |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by obidevine(m): 9:40pm On May 01, 2016 |
735i: you are very smart, please check my signature you might see something of interest to you. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by obidevine(m): 9:44pm On May 01, 2016 |
bookface: You are very smart, nice one, your explanation is very concise, please check my signature it's for smart people like you |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by KingsleyTMTTM(m): 9:44pm On May 01, 2016 |
nawao, so they later downgrade us |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by musicwriter(m): 9:46pm On May 01, 2016 |
You people must understand these are threats to pressure Nigeria to IMF or and world bank loan. I've been saying this all the while that Nigerians should expect more of such actions. Moodys is among the capitalist network that control the world's economy. And they in turn are owned by the IMF and world bank. So, they work hand in hand. These threats would end the day the president bow to pressure for world bank or IMF loan. Or stand his ground to diversify the Nigerian economy my looking inward, even if it means temporary suffering. See the Capitalist Network That Control The World's economy http://www.africason.com/2015/05/the-capitalist-network-that-control.html |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by allexy2: 9:47pm On May 01, 2016 |
Am not suprise at this moody rating. It should by now be obvious to nigerian that western countries the brain behind the economic situation we are going through. Have you wonder why our problem became so bad in 2015 Don't forget that around 2002, America said Nigeria will divide by 2015. Their gaol was to use boko haram to create that division where the north and south will go into civil war. They use boko haram as a guise to make it look like northerners are killing southerners. That way, the south will hit back and civil war will start to the point where both side begin to kill each other. Unfortunately for the Western countries, the plan did not work becos nigerian army have been able to deal ruthlessly with boko haram. Have then wonder why western countries are quick to come to send their military to come fight boko haram ? Nigerians, we all need to see the obvious. Even the missing girls is a scam use to make the federal government look weak so that they can can on western countries military to come to nigeria to help. This is scam to invade nigeria oil just like what they did in Iraq and Libya. THANK GOD BUHARI AND JOHANTHAN DID NOT ALLOW THEIR MILITARY IN TO NIGERIA. Since they know the whole game plan did not work, their last resort is to use economic warfare to make nigeria bow to their pressure. This is why you notice lately that attempt have been made to make the NAIRA a worthless currency.how if you may ask me ? Do you actually think the naira lost its value mainly as a result of low oil demand ? Think about it for a second. There is a conspiracy between saudi and western countries to manipulate oil price.that way, it will affect the value of countries that produce oil. This is a fact. Ask yourself that, how come America and other western countries that their economy is so bad that the value of their currency became string OVER NIGHT ? A country that manufacture NOTHING.can someone explain this to me. This is where u k ow that the banking system is a scam. The western countries will always make their currencies very strong. That way, they can print money in exchange for our natural and mineral resources all over Africa. The america dollars is a scam ! It is just a paper. To complement their evil plans to destroy nigeria, IMF came in few month ago to say they can help nigeria. Thank God buheari did not fall for this. Notice that naiara have now been badly devalued that even IMF is telling us to devalue. This rhis make economic sense ? By now, nigerians show have been suspecting foul play that something is not right. Fortunately, buhari was smart enough to go meet china for help. The moment IMF saw that, they came in to say they will like to borrow nigeria money . Really ? You will notice that around that time when buhari went to sign some deal with the Chinese, the naira start to gain strength strength again. IMF was not happy about it it becos they know they have been busted. Now, we are hearing about moody rating. To hell with all of this western countries and their evil organisations. their main agenda to to create kiosk in the country to a level where we will be force to sell all our resources to western companies. Look at them calling for privatisation of all oil sector, phcn etc. I use to wonder if the nigerian cannot see the scam taking place before their eyes Nigerian must must be smart to see the obvious 2 Likes |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by oje20(m): 9:49pm On May 01, 2016 |
[quotae author=Kezifils post=45222581]If u understand this, help me out cos all I see is B's everywia[/quote] but you went to sch bro am just joking o |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by axeman10(m): 10:01pm On May 01, 2016 |
bookface: Spot on. For those asking 'How does it affect the layman?' It means if the government has to raise money from the bond market to provide infrastructure - roads, upgrade electricity etc, Nigeria will have to pay more in terms of interest on the bond, because the risks of defaulting seems higher from the market point of view. A lot of institutional investors will rather invest in the highest quality bonds where they are sure of no risk of defaults. Though this may be temporary as crude oil prices increases and more revenue generated by the country, Nigeria may have better and positive views from the market. As it is, it costs more to borrow money long term to provide infrastructures compared to other stable and advanced economies. Reason why building infrastructure may be expensive as you and I feel the pinch in terms of road tolls, high electricity tariffs etc. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Nobody: 10:04pm On May 01, 2016 |
More negative new for Nigeria, especially for Nigerian banks. Our banks have lines of credit with international banks, and further borrowing from these banks will lead to higher interest rate, based on this Moody's poor ratings.. Even worse would be the case if Fitch and S&P follows suit. Not surprised. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by Firefire(m): 10:05pm On May 01, 2016 |
The way we rate national economies is all wrong, says rating agency reformer Annette Heuser. With mysterious and obscure methods, three private US-based credit rating agencies wield immense power over national economies across the globe, and the outcomes can be catastrophic. But what if there was another way? In this bold talk, Heuser shares her vision for a nonprofit agency that would bring more equality and justice into the mix. If you have enough data please take your time to watch the below video and you will form a different opinion about Moody and its co-travelers. https://www.ted.com/talks/annette_heuser_the_3_agencies_with_the_power_to_make_or_break_economies |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by axeman10(m): 10:17pm On May 01, 2016 |
allexy2: Sorry bro. I beg to disagree. It wasn't the west that said we should mismanage our revenue when there was oil boom. We know we generate 90% of our revenue from crude oil. If we had made hays while the sun shines...we will have enough reserve to at least withstand the shock of slump in oil prices. Well, our ratings will naturally drop as long as we our only source of revenue is depleted due to falling oil prices. What do you expectin situations where the government (federal and state) don't even have enough to pay workers salaries not to talk about finance our budget. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by dvee2: 10:20pm On May 01, 2016 |
Sunnycliff: Only a narrow minded fellow will blame Buhari for the current economic downturn. |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by haqueurate(m): 10:44pm On May 01, 2016 |
Kai fell off "agbaluma tree" lol @ comments. Naija ehh, moody is just an agency that measures and speculates credit worthiness of countries. The grading pattern is to help investors know how risky the financiall balance of these countries are so far we are considered stable even though we might not grow significantly due to falling oil prices |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by lekenzie: 10:54pm On May 01, 2016 |
Please anybody that understands this post should kindly break it down and explain to me cus all I see is b1 b2 b3 |
Re: Moody’s Downgrades Nigeria's Issuer Ratings From Ba3 To B1 by NovusHomo(m): 11:24pm On May 01, 2016 |
phreakabit: Since these things don't happen overnight, we have to thank Fortunato, the Ineffectual Buffoon; also known as Goodluck Emere Jonathan. |
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