Africa Finance Corporation (AFC), one of Africa’s biggest investors in infrastructure development, achieved a 20 percent growth in total assets in 2020 despite the pandemic.
This was seen in its recently released audited financial statements for 2020, which showed that the Corporation’s total assets hit $7.36 billion, an upward movement from the $6.12 billion achieved in 2019.
According to the report, the asset growth was largely driven by the robust pipeline of infrastructure opportunities, maturing project development initiatives and repeat business from clients seeking to capitalize on the opportunities from the disruption in the global supply chain to embark on import substitution projects and value accretive beneficiation of African resources.
The Corporation’s liquidity position grew by 12 percent to $2.40 billion from $2.13 billion in 2019 while its total equity improved 22 percent from $1.71 billion to $2.08 billion in 2020.
AFC’s net interest income grew marginally by 3 percent to $167.1 million in 2020 from $162.6 million in the previous year.
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However, its total comprehensive income declined marginally by 5 percent to $156.5 million from $164.5 million in the same period of 2019 while its profit for the year dropped by 10 percent from $183.3 million in 2019 to $165.5 million in 2020.
Samaila Zubairu, President & CEO of AFC, said the company’s financial performance despite the pandemic highlights AFC’s resilience and the vital role it plays in infrastructural development.
“We maintained the growth and profitability trajectory in our strategic plan with improved portfolio quality, a strong capital base, and a high liquidity position during an unprecedented time of a global pandemic which is a testament to the Corporation’s resilience driven by our strong team of agile professionals and our vital role in Africa’s infrastructure and industrial development,” he explained.
During this period under review, AFC diversified its fund and increased its total borrowing by 17 percent to $5.1 billion. In addition to a $700 million Reg S Eurobond in June 2020, the Corporation issued its inaugural CHF150 million Reg S Green Bond in September 2020 with significant oversubscription.
AFC also secured $250 million tier-2 capital from the US International Development Finance Corporation, boosting the Corporation’s capital, and enhancing its ability to create assets.
The Arab Bank for Economic Development in Africa and the Republic of Gabon became equity shareholders of Africa Finance Corporation in 2020, with equity injections of $10 million and $50 million, respectively.
Giving an outlook for 2021, Zubairu said, “Our role becomes even more critical as we look ahead, especially at this time when African economies have begun the journey of recovery from the impact of COVID-19, AFC will continue to partner with African governments and sponsors to ensure sustainable development and production of the metals required for the energy transition.”
He added that the corporation will support projects that reduce carbon dioxide emissions with greater focus on the requisite energy infrastructure, renewable projects and the digital infrastructure that should enable Africa to build back better with more resilient and sustainable infrastructure.
Other key milestones AFC recorded in 2020 included an expanded investment footprint in Africa to 35 countries, growing the cumulative disbursements to $8.7 billion as against the $7.2 billion achieved in 2019.
