Fitch Ratings has placed Union Bank of Nigeria PLC's (UBN) Issuer Default Ratings (IDRs), Viability Rating (VR) and National Ratings on Rating Watch Negative (RWN). A full list of rating actions is below.

UBN's Government Support Rating of 'no support' is not affected by this rating action.

Key Rating Drivers

The RWN follows the Central Bank of Nigeria's (CBN) announcement on 10 January that it had dissolved the board and management of three Nigerian banks, including UBN, as a result of regulatory non-compliance, corporate governance failure, disregarding the conditions under which banking licenses were granted and involvement in activities that pose a threat to financial stability, among other infractions. The CBN has since appointed new executives, including chief executive officers, to oversee the affairs of the banks.

The RWN reflects the uncertainty surrounding the background to the CBN's intervention, the potential for further regulatory actions and the negative implications for UBN's standalone credit profile, particularly relating to corporate governance risks and liquidity pressures arising from potential funding instability. Fitch expects to resolve the RWN within six months once there is more certainty regarding the CBN's intervention and the implications for UBN's standalone credit profile.