Fitch, GCR upgrade Afreximbank’s Outlook to positive as Moody’s affirms stable ratings

African Export-Import Bank (Afreximbank) has received a set of strong credit rating affirmations and “Positive” outlooks from Moody’s, Fitch Ratings, and GCR Ratings, underlining its resilient financial position and performance. The ratings reinforce the Bank’s access to capital at a competitive cost, ensuring the continued success of key strategic initiatives to stimulate African trade.

Fitch revised its outlook on Afreximbank’s Long-Term Issuer Default Rating (IDR) to positive from stable, highlighting that the upgrade “reflects the bank’s growing importance as the main multilateral development bank (MDB) providing funding to non-sovereign borrowers in Africa.” The agency further affirmed the Bank’s IDR at ‘BBB-‘, its Short-Term IDR at ‘F3’, and its senior unsecured debt at ‘BBB-‘. Fitch observes that “the significant capital increase (USD6.5 billion, of which USD2.6 billion paid-in) approved by the board of directors in June this year highlights the increased strategic relevance of the bank for its African shareholders.”

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Furthermore, Moody’s affirmed the Bank’s ‘Baa1’ rating with a Stable Outlook, while GCR affirmed Afreximbank’s international scale long-term and short-term issuer ratings of ‘A-‘ and ‘A2’, respectively, with the Outlook, revised to Positive from Stable.

The agency notes that this positive outlook factors in its expectation “for the status of the Bank as one of the most influential Africa focused Multilateral Development Bank (‘MDBs’) to strengthen, cemented by its development impact on the African continent (measured by the loan book) now closing in on the USD20bln mark.” GCR similarly affirmed the international scale long-term issuer rating of ‘A-‘ on the Bank’s USD5 billion Global Medium-Term Note (GMTN) programme, with a Positive Outlook.

The strong credit ratings achieved by the Bank are vital to its ongoing mandate, enabling access to global financial markets and allowing Afreximbank to access funding at a reasonable cost. The affirmation of Afreximbank’s investment-grade status and the upgraded outlook from Fitch demonstrates the systemic relevance of the Bank demonstrated by its robust resilience through the recent pandemic which resulted in unprecedented economic turbulence.

The credit rating agencies also underline the continued confidence in the Bank’s ability to deliver attractive financial returns while fulfilling its core mandate of expanding, diversifying, and developing African trade.

Benedict Oramah, President of Afreximbank, said, “Afreximbank believes in harnessing the power of trade to create jobs, grow prosperity, and help Africa reach its full economic potential. However, to support this vision the Bank must have access to diverse sources of capital at a competitive cost.

The strong ratings from Fitch, Moody’s and GCR help ensure this access remains open, enabling us to continue driving our mandate at a time when African nations most need our support.

Management of the Bank has ensured it is resilient to challenges and ready to capitalise on the rich potential offered by our continent. The ratings demonstrate confidence in this approach and will help energise our plans as we work to support a new era for African trade.”