GCR Revises Bank to Stable, Affirms BBB(NG), A3(NG)

GCR Ratings has revised the outlook on Quest Merchant Bank Limited to Stable from Rating Watch Negative while affirming the bank’s national scale issuer ratings of BBB(NG) and A3(NG), citing improvements in the bank’s capitalization, liquidity profile and overall financial strength.

The ratings action comes after what analysts described as a transformative period for the merchant bank, reflecting renewed confidence in its financial strength, liquidity position, capitalisation and long-term growth prospects.

According to GCR, the Stable Outlook was driven by the bank’s sound risk profile, stronger capital base and robust liquidity metrics, as well as the successful transition in ownership structure following its acquisition by EverQuest LLP after the divestment by FBN Holdings Plc.

The rating agency further noted that Quest Merchant Bank maintained a strong foothold within Nigeria’s merchant banking space, accounting for about 30 per cent of the sub-sector’s total assets as of December 31, 2025, a development that reinforces its standing among the country’s leading merchant banks.

Further strengthening the bank’s outlook was the successful completion of its N42.9 billion capital raise in March 2026, in line with the revised minimum capital requirements introduced by the Central Bank of Nigeria.

GCR stated that the fresh capital injection is expected to improve the bank’s capital adequacy position while supporting the next phase of business expansion and strategic growth.

The bank’s asset quality and liquidity profile also remained key factors supporting the ratings affirmation. Quest Merchant Bank sustained a non-performing loan ratio of 3.2 per cent, significantly below the broader banking industry average, while maintaining resilient earnings and strong liquidity buffers.

In addition, GCR highlighted the strategic importance of the bank’s relationship with Custodian Investment Plc, noting that the partnership could unlock stronger business opportunities, operational synergies and improved profitability over time.

Commenting on the development, the acting managing director and Chief Executive Officer of Quest Merchant Bank, Afolabi Olorode, described the outlook revision as a strong vote of confidence in the bank’s future and the progress achieved over the past year.

He said the recognition reflected “the resilience of our business, the quality of our balance sheet, and the confidence our clients, partners and stakeholders continue to place in the Bank.”

According to him, the institution has emerged from a defining transition period “stronger, well-capitalized and better positioned to capture the opportunities ahead.”

Olorode added that the bank would remain focused on delivering innovative solutions, creating long-term value and supporting economic growth across critical sectors of the economy.

GCR said the Stable Outlook reflects expectations that Quest Merchant Bank will continue to maintain sound asset quality, stable funding and strong liquidity metrics over the next 12 to 18 months, reinforcing confidence in the bank’s strategic direction and operating fundamentals.