GCR Upgrades Afreximbank Rating

Global Credit Rating (GCR) has announced an upgrade of the African Export-Import Bank’s (Afreximbank) long-term international scale rating from BBB+ to A-. GCR also affirmed the Bank’s short-term rating at A2 and the outlook as stable. In the announcement released in Johannesburg, South Africa, the rating agency said in granting the upgrade, it acknowledged Afreximbank’s tenacity and resilience in managing risks in its operating environment, which was generally perceived to be high risk. “The ratings on Afreximbank balances its significantexposuretohighriskoperatingenvironments,fairlystrong and diverse membership base, demonstrated preferential creditor treatment, strong status within the region and good track record of fulfilling mandate, beyond adequate current levels of capitalisation, strongriskposition,stablefundingandgoodliquidityposition,”stated GCR. According to agency, the new rating also captures the Bank’s key strength in structured trade finance which demonstrates its ability to de-risk its lending portfolio through high quality collateral comprising cash, insurance from highly-rated insurers, sovereign backed securities, assignment of receivables (which transfers repayment risk to OECD countries), amongst others. “This upgrade confirmsstakeholders’deepconfidenceinAfreximbank’scompelling credit story, which is punctuated by hard work and an innovation culture,”saidAfreximbankPresidentProf.BenedictOramah,inreaction to the announcement. “Afreximbank is committed to continuing to develop and implement innovative risk management approaches in the management of its lending book and capital.”