Page 96 - 2021 ANNUAL REPORT draft

5 (BB) Average • Satisfactory asset quality and liquidity
• Good debt capacity but smaller margins of debt service coverage
• Reasonable management in key areas
• Temporary difficulties can be overcome to meet debt obligations
• Good management but depth may be an issue
• Satisfactory character of owner
• Typically good companies in cyclical industries

6 (B) Acceptable Risk • Limited debt capacity and modest debt service coverage

• Could be currently performing but susceptible to poor industry
conditions and operational difficulties
• Declining collateral quality

• Management and owners are good or passable

• Typically borrowers in declining markets or with small market
share and operating in cyclical industries
• Eliciting signs of deterioration as a result of well-defined
weaknesses that may impair repayment
• Typically start-ups/declining markets/deteriorating industries with
7 (CCC) Watch-list high industry risk
• Financial fundamentals below average

• Weak management

• Poor information disclosure

• Well-defined weaknesses though significant loss unlikely; orderly
liquidation of debt under threat

Substandard • Continued strength is on collateral or residual repayment capacity
8 (CC) Risk of obligor
• Partial losses of principal and interest possible if weaknesses are
not promptly rectified
• Questionable management skills

• • High probability of partial loss
Very weak credit fundamentals which make full debt repayment in
• serious doubt
Factors exist that may mitigate the potential loss but awaiting
9 (C) Doubtful Risk appropriate time to determine final status
• Demonstrable management weaknesses, poor repayment
weaknesses and poor repayment profile
• • A definite loss of principal and interest
• Lack of capacity to repay unsecured debt
10 (D) Lost Bleak economic prospects
• Though it is still possible to recover sometime in the future, it is
imprudent to defer write – offs

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Guaranty Trust Bank (Gambia) Limited Financial Statements December 2021