African Rating Agencies

Agusto & Co.  

Agusto & Co., a Nigerian credit rating agency with offices in Nigeria, Kenya, Rwanda, and Ghana, do generate sovereign credit ratings but a. do not reveal the methodology publicly, and b. have only one recognised Sovereign & Supranational rating on their website, which is for the African Finance Corporation. 

 

Bloomfield Investment Corporation 

Bloomfield Investment Corporation provides ratings for African entities, and also sovereign ratings. Its methodology is publicly available (in French only). The structure of the sovereign methodology and its contents are almost identical to the big three methodologies and include a focus on: 

  1. Political and Social Environment 

  • This includes: Social Structures, and Political Environment 

  1. Macroeconomic Analysis 

  • This includes: Economic Performance, and Coherence of the Economic Policy Implemented 

  1. Public Finances 

  • This includes: Estimation of Public Debt, Debt Weight, and State Budget 

  1. Monetary Institutions and Policy 

  2. External Situation 

  • This includes: External Debt, External Assets, and External Financing Policy. 

How the above is weighted against each other to come to an overall rating is not declared, nor are there any indications as to likely sources of information for any of the determinants. 

 

GCR Ratings  

GCR Ratings is the largest rating agency on the African Continent. It was purchased by Moody’s in 2022 and provides almost three times more ratings than its nearest coverage competitor, S&P. GCR does not provide sovereign ratings, but instead generates ‘sovereign risk’ scores that it injects into its corporate ratings.  

 

To determine this Country Risk Score, GCR apply the following metrics/categories: 

 

  1. The Structural Country Risk Score 

  • Which includes ‘Economic Strength’, which takes into account metrics such as GDP per Capita. 

  1.  Idiosyncratic Stress & Sovereign Risks or Strengths 

  • Which includes ‘Fiscal’, ‘Geopolitical’, ‘External Position’, ‘Monetary Policy’ and ‘Size and Diversification’. 

 

Sovereign Africa Ratings 

Sovereign Africa Ratings is a domestic Credit Rating Agency situated in South Africa. A relatively new player to the field, the small agency does publish its methodology. The sovereign methodology of Sovereign Africa Ratings is based on five (5) particular pillars. They are: 

  1. Economic Strength  

  • This includes aspects such as GDP Growth and Relative Size, and the Structure 

  1. Financial Strength 

  • This includes aspects such as the debt profile and the local currency/financial markets 

  1. Institutional Strength 

  • This includes aspects such as Institutional Effectiveness 

  1. ESG 

  2. Natural Resources 

  • This includes aspects such as Extraction and Beneficiation.