Rating action follows acquisition of three African banks
Moody's Investors Service has affirmed the long- and short-term foreign currency deposit ratings of Groupe Banque Centrale Populaire (GBCP) at Ba2/NP as well as its long- and short-term local currency deposit ratings at Ba1/NP. Moody's has maintained the outlook on the bank's long-term deposit ratings at stable.
At the same time, Moody's has downgraded GBCP's Baseline Credit Assessment (BCA) and Adjusted BCA to b1 from ba3.
The affirmation of GBCP's deposit ratings reflects Moody's continued expectation of a very high probability of government support in case of need. This view counterbalances the BCA downgrade, which in turn captures Moody's expectation that GBCP's recent acquisition of three African banks from France-based Groupe BPCE will result in weakening asset quality and capital, partly moderated by GBCP's healthy problem loan coverage and recently increased capitalisation buffers.
In October 2019, GBCP has entered into agreements for the acquisition of a 68.5% stake in Cameroon-based Banque Internationale du Cameroun pour l'Epargne et le Credit (BICEC), a 100% stake in Republic of Congo-based Banque Commerciale Internationale (BCI) and a 71% stake in Madagascar-based Banque Malgache de l'Ocean Indien (BMOI).
GBCP, established in 1926, is a Morocco-based cooperative bank with reported total assets of $42.6 billion and a 24% market share in terms of total Moroccan loans as of June 2019. The bank has pan-African activities, with operations in 28 countries primarily in Africa and Europe.
