East Africa Bank turns cautious as shareholders face turmoil
East Africa Development Bank’s (EADB) reliance on cheap long-term funds will protect its balance sheet even as it shareholders, the governments of Kenya, Uganda, Tanzania and Rwanda face tough economic conditions. Rating agency Moodys has affirmed the EADB’s Baa3 long-term issuer rating and maintained the stable outlook on grounds the bank had taken risk mitigation measures rather than on the strength of its shareholders. Moodys, which recently cut Kenya’s credit rating from B2 to B3 said the country’s negative rating, Rwanda’s B2 stable, Tanzania’s B2 positive and Uganda’s B2 negative means the shareholders are unlikely to intervene if the bank came under pressure owing to
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