June 20, 2025
Banks

Most Nigerian firms  presently servicing long term facilities are more vulnerable to interest rates  because they have higher debt servicing costs.

Caverton Offshore Support Plc has interest coverage ratio of 1.35; Total Nigeria Plc, 1.01, Livestock Feeds Plc, 1.05, and Dangote Sugar, 0.09, according to permutations.

The Interest Coverage Ratio (ICR), also known as the Times Interest Earned (TIE) ratio, is a financial metric that assesses a company’s ability to pay its interest expenses on outstanding debt. It’s calculated by dividing the company’s earnings before interest and taxes (EBIT) by its interest expense.

Even as interest rates are high, the interest coverage ratio of most companies is above the threshold as they are able to sustain strong earnings amid a challenging environment.

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria retained the Monetary Policy Rate at 27.50 per cent, marking its second consecutive hold in 2025, meaning firms often borrow at above 30% per annum.

Higher interest rates are deleterious to firms or businesses because it makes borrowing more expensive and magnifies the finance costs, which in turn squeezes cash flow and profit margins.

The country’s headline inflation rate dropped to 23.71 per cent in April 2025 from 24.23 per cent in March, according to data gathered by the National Bureau of Statistics (NBS).

“The MPC noted the relative improvements in some key macroeconomic indicators which are expected to support the overall moderation in prices in the near to medium term,’ said Olayemi Cardoso, the Central Bank of Nigeria (CBN) Governor.

3 thoughts on “High interest rates may cripple Caverton, Livestock Feeds, and other debt servicing companies.

  1. Primobolan will decrease endogenous testosterone levels notably, yet we now have discovered it to be the least suppressive anabolic
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    To save complicated arithmetic, you could carry out 2
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    Others use capsule cutters to split 10 mg tablets in half, giving them 4 x 5 mg doses.
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    DHT (dihydrotestosterone) is a robust androgen that binds
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    a 33% lower in HDL whereas elevating LDL levels by roughly
    30%. Males who obtained 80 mg of Anavar per day skilled a
    50% decline in HDL levels. In one research, males with HIV obtained 20 mg of
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    the outcomes, the extra extreme the side effects are.

    This is amongst the most common anabolic steroids used to combat muscle wasting
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    This nice recomp or contest prep cycle contains Deca for additional mass gains
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