Afreximbank assets hit $30.1 billion in first half of 2023.

Total assets of African Export-Import Bank (Afreximbank) increased by eight per cent to $30.1 billion in the first half of 2023.

The consolidated financial statements of Afreximbank for the half year ended June 30,2023 indicated that the group’s total balance sheet size expanded by 8.0 per cent from $27.9 billion recorded by year ended December 31, 2022 to close approximately at $30.1 billion as at June 30, 2023.

The balance sheet growth was driven by increase in loans and advances to customers, which grew by 13 per cent to $26 billion. The liquidity position remained strong at $3 billion, representing 11 per cent of total assets and achieving a liquidity coverage ratio of 310 per cent.

Also, due to increased volume of interest-earning assets, particularly loans and advances and higher interest rates, total interest income doubled by 107.1 per cent to $1.1 billion in first half 2023 compared with $540.8 million recorded in first half in 2022.

Net interest income rose by 76 per cent to $663.6 million, driven mainly by continuous effective management of interest expenses. Net interest margin had improved from 3.47 per cent in first half 2022 to 4.77 per cent in first half 2023.

Afreximbank’s group’s shareholders’ funds rose by 7.63 per cent to $5.6 billion in first half 2023, due partly to $261 million fresh equity contributions from existing and new shareholders who had supported group’s general capital increase exercise which aims to raise $2.6 billion paid-in equity by 2026. The growth in shareholders’ funds was also underpinned by $125.5 million internally generated net earnings after taking into account the approved dividend and other appropriations which amounted to $209 million.

Executive Vice President, Finance, Administration and Banking Services, Afreximbank, Mr. Denys Denya said the bank marked its 30th anniversary, which fell during the first half 2023, with a strong set of results.

He said the results were driven largely by a focused execution of the group’s mandate as a countercyclical lender which generated increased volume of interest-earning assets, particularly loans and advances and benefited from a rising interest rate environment.

“The bank continued to make progress on its strategy implementation, carefully balancing the need to be profitable and sustainable, while maintaining sufficient liquidity, capital, and a quality portfolio of assets,” Denya said.

He noted that despite the continued challenges caused by the Ukraine crisis, ongoing geo-political tensions and persistently high inflation, the half-year period saw some headwinds receding, including relatively lower energy and food prices, reduced supply bottlenecks and the re-opening of China, Africa’s biggest trading partner.

He pointed out that Global Credit Rating (GCR) and Japanese Credit Rating (JCR) respectively affirmed Afreximbank’s international scale long and short-term issuer ratings of A/A2 and A-, with a “Stable” Outlook, while Moody’s maintained the Bank’s credit rating at Baa1. In addition, African Banker recently awarded Afreximbank the 2023 African Bank of the Year and Development Finance Institution (DFI) of the Year awards in recognition of the bank’s contributions to the continent’s trade and development.

According to him, significant progress was made during the first half of the year with the bank’s subsidiary FEDA generating profit after only two years of operation and AfrexInsure generated premium income on assets valued at over $2 billion.

“We began the second half of 2023 well and are confident that Afreximbank’s strong financial position will provide a solid base for the group to continue assisting its clients and African countries in expanding trade and investments, meet trade finance obligations, boost production especially of food and export value added products, as well as alleviate supply chain constraints and enable the continent to adapt sustainably to the challenging effects of climate change,” Denya said

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