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RPT-Fitch: Ecobank's Issues Flag Pan-African Banks' Regulatory Risks 

February 6, 2014

The findings of the Nigerian Securities and Exchange Commission investigation into Ecobank Transnational Incorporated (ETI) this month highlight the supervision and corporate governance risks of large pan-African groups, Fitch Ratings says. Insufficient cross-border supervision and lower regulatory standards in some frontier markets are constraints on the ratings of pan-African banking groups.

The ratings of many African banks already incorporate operating risks from volatile political and economic environments, and significant credit risks from weak asset quality, high related-party lending and large asset concentrations. Pan-African banks are growing rapidly, but diversification is not always beneficial to their credit profiles, and their ratings are also constrained by the lack of consolidated supervision and collaboration among national regulators.

Read more: Reuters

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