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S&P downgrades Skye Bank on default concerns

S&P Global Ratings on July 11 lowered 's long-term counterpartycredit rating to CCC- from CCC+ and affirmed the short-term counterparty creditrating at C.

The agency also lowered Skye Bank's long- and short-termNigeria national scale ratings to ngCCC-/ngC from ngB+/ngB. The bank's globalscale short-term rating was placed on CreditWatch negative, while the long-termratings and the national scale short-term rating were maintained on CreditWatchnegative, where they were placed June 16.

The agency said it believes that the Nigerian lenderbreached some regulatory ratios, including the minimum capital adequacy andliquidity ratios, as well as a guideline by the regarding themaximum nonperforming loans ratio. The central bank in early July the lender's managementteam and board of directors to prevent its failure and a potential threat tothe overall stability of the Nigerian financial system.

S&P Global Ratings now believes a default of Skye Bank"appears highly likely" within the next six months, unless there are"unanticipated significant favorable developments."

The agency aims to resolve the CreditWatch in the next 90days, depending on the further management or regulatory actions that may betaken with respect to the bank's financial sustainability.

S&P Global Ratingsand S&P Global Market Intelligence are owned by S&P Global Inc.