China Chengxin International Credit Rating has given Afreximbank a AAA rating with a stable outlook

China Chengxin International Credit grade Co., Ltd (CCXI) has given a ‘AAA/Stable’ grade to the African Export-Import Bank (Afreximbank), which is a trade finance bank that serves all of Africa.

In its 2024 Credit Rating Report for the African Export-Import Bank, CCXI highlighted several key strengths of Afreximbank. These include its strong market position, effective risk management, ability to adapt and generate business, strong profitability, and careful management of cash flow, supported by a good balance of current assets compared to short-term debts.

By the end of December 2023, Afreximbank had over $37.3 billion in total assets and reserves, with shareholder funds reaching $6.1 billion.

CCXI acknowledges that Afreximbank plays an important role in Africa and can effectively achieve its goals while serving the needs of member countries at various development levels, even in tough times. The report also stated that it expects the bank’s ratings to stay stable for the next 12 to 18 months.

Denys Denya, Afreximbank’s Senior Executive Vice President, noted that the rating represented the strongest endorsement the bank had received from any credit rating agency and that the Bank had become one of the first African multilateral financial institutions to achieve a top credit rating grade in the Chinese market, especially on the strength of its stand-alone credit profile.

“This shows how important the bank is to Africa. It highlights its effective work in development, careful management of risks, and ongoing attention to its finances. This strong performance has led to a top rating, allowing us to find better funding options in China and expand our funding sources,” she said.

Denya says the rating helps Afreximbank strengthen its position as it starts raising funds in a new capital market. They aim to use financial resources effectively in Africa.

He pointed out that the ‘AAA’ credit rating would give utmost assurance to the bank’s new and current funding partners in China to support the bank’s fundraising activities on competitive terms and would position the bank to follow its developmental purpose and goals.

Since 2019, Afreximbank has increased its assets by 28%, with an average yearly growth rate over five years. It has also achieved an average return on equity of 11% and maintained a capital adequacy ratio of 25.5%.

In 2021, it started its biggest effort to raise money, hoping to get $2.6 billion by 2026. However, it reached almost 90% of that goal in just three years, even with changing economic conditions.