African Export-Import Bank's AAA Credit Rating Affirmed

Strategic Insights -

African Export-Import Bank (Afreximbank) has had its AAA issuer credit rating affirmed by China Chengxin International Credit Rating Co., Ltd (CCXI) with a stable outlook. This reflects CCXI's evaluation of Afreximbank's strong strategic positioning, sound risk management, flexibility in business development, and very high profitability. The rating agency expects Afreximbank's ratings to remain stable over the next 12 to 18 months despite potential downside risks to the macroeconomic and operating environments.

Key Takeaways:

  • CCXI has affirmed Afreximbank's AAA issuer credit rating with a stable outlook, reflecting the bank's high strategic positioning, sound risk management, and very strong profitability.
  • The rating reflects Afreximbank's strengths, including flexibility in business development, prudent liquidity management, and a very high coverage ratio of current assets on short-term debts.
  • CCXI believes that Afreximbank's ratings will remain stable over the next 12 to 18 months, even after considering downside credit risks to the macroeconomic and operating environments.
  • Afreximbank's commitment to its member states and all clients remains unwavering, contributing to its formidable rating.
  • Mr. Denys Denya, Afreximbank's Senior Executive Vice President, noted that the AAA rating will enhance funding diversification opportunities, particularly in China's Panda bond market, supporting Afreximbank's development mandate and trade facilitation between Africa and China.
  • The Chinese rating affirms Afreximbank's preferred creditor status among its 53 member states in Africa and 13 in the Caribbean.
  • CCXI's rating is expected to galvanise greater support for Afreximbank's funding plans in the Chinese market and enhance the Bank's market presence and credit position.

Statistics:

  • Total assets and contingencies at the end of December 2024 stood at over US$40.1 billion, and shareholder funds amounted to US$7.2 billion.
  • Afreximbank has issued a landmark inaugural Panda bond in the China Interbank Bond Market, raising RMB 2.2 billion (US$ 303 million) in April of this year.
  • The Panda bond was oversubscribed and attracted high-quality investors, underscored strong market confidence in Afreximbank's credit profile.
  • The bank has launched a Pan-African Payment and Settlement System (PAPSS) adopted by the African Union (AU) as the payment and settlement platform to underpin the implementation of the AfCFTA.

Sources:

  • China Chengxin International Credit Rating Co., Ltd (CCXI)
  • African Export-Import Bank (Afreximbank) press release
  • Afreximbank's website (www.Afreximbank.com)