Letshego Holdings Limited acquired AFB Ghana Plc in January 2017. Following the acquisition, AFB Ghana rebranded to Letshego Ghana Savings and Loans PLC in September 2019. The ratings on Letshego Ghana reflect the company’s relatively weak business profile in comparison to domestic commercial banks characterised by its small size, high cost of funds (CoF) and monoline operations.
The outlook is negative, reflecting the strain of the operating environment on the financial profile. We expect the capitalisation to range between 16% and 18%, supported by the conversion of group subordinated debt, as well as internal capital generation that is quicker than risk weighted asset growth, and rising cost of risk.