Fitch Ratings says the recent upgrade of Fidelity Bank Plc reflects the lender’s strengthened capital buffers following a successful recapitalisation exercise.

The global rating agency in a statement on Thursday said Fidelity’s capital raising, alongside improved operational performance, spurred its decision to affirm the bank’s long-term issuer default rating (IDR) at ‘B’ while upgrading its national long-term rating to ‘A+(nga)’ from ‘A(nga)’, with a stable outlook.

“This is underpinned by a sharp improvement in profitability metrics since 2022, as the bank benefits from higher rates due to its heavy reliance on low cost current and savings accounts,” Fitch said.

The development comes as banks concluded their recapitalisation exercise on March 31, deadline set by the Central Bank of Nigeria (CBN).

The agency added that the bank’s ratings are driven by its standalone creditworthiness, expanding franchise, and improving profitability metrics.

“It also reflects an expanding franchise, sound profitability metrics, strengthening capital buffers and good foreign-currency (FC) liquidity coverage,” the agency said.

The rating firm noted that Fidelity Bank’s market position has strengthened in recent years, with the lender ranked as Nigeria’s sixth-largest bank by assets, accounting for about five percent of the domestic banking system as of 2024.

Fitch added that the bank’s strong deposit base, largely made up of low-cost current and savings accounts, supports funding stability and continued balance sheet growth.

Reacting to the rating Fidelity Bank said the outcome of its capital raising reflected “investor confidence, noting that its shareholder base ,which exceeds 400,000, contributed to strong participation, particularly from retail investors.”

The bank also said its shares have remained actively traded on the Nigerian Exchange, supported by a high free float and diverse ownership structure.

The bank noted that its now better positioned to expand its operations and meet investor expectations following the completion of the recapitalisation programme.