By Baboloki Semele

The African Export-Import Bank (Afreximbank) has released its consolidated financial statements for the first half of 2024, revealing solid growth and resilience in the face of challenging macroeconomic conditions. The Bank’s results underscore the effective execution of its strategic plan, despite the economic headwinds facing the continent.

For the six months ending June 30, 2024, Afreximbank reported a 24.5% increase in Net Interest Income, which reached US$826.2 million, up from US$663.6 million in the same period last year. This growth was primarily driven by a 31.42% rise in interest income, which soared to US$1.5 billion, reflecting the expansion of the Bank’s portfolio of loans and advances. Notably, the Fund for Export Development in Africa (FEDA), a subsidiary of Afreximbank, contributed US$11 million to the Group’s Net Interest Income, marking an increase from US$9.1 million in the first half of 2023.

The Group’s total fees and commission income also saw a significant boost, rising by 20.07% to US$71.2 million, compared to US$59.2 million in the first half of 2023. These financial gains demonstrate Afreximbank’s strong operational performance, driven by its continued strategic focus on promoting African trade and deepening ties with Caribbean countries and the broader diaspora.

Operating expenses for the period increased by 30.38% to US$152.8 million, up from US$117.2 million in the first half of 2023. This rise is attributed to higher personnel and administrative costs, reflecting the Bank’s efforts to support its initiatives amid a high-inflationary environment. Despite these increased expenses, the Bank maintained a low Cost to Income Ratio of 16.98%, well within its strategic upper limit of 30%.

Afreximbank’s overall financial position remains strong. The Group’s Shareholders’ Funds rose by 1.64% to US$6.2 billion, reflecting growth in internally generated Net Income of US$407.7 million. Although there was a slight decline in loans and advances, from US$26.7 billion to US$26 billion, due to the winding down of the Ukraine Crisis Adjustment Trade Financing Programme for Africa (UKAFPA), the Bank’s liquidity position remains robust, with cash and cash equivalents closing the period at US$3.9 billion.

During its Annual General Meeting held in Nassau, The Bahamas, in June 2024, Afreximbank’s shareholders approved a dividend of US$264.6 million and an additional US$50 million appropriation to support concessionary funding. The Bank’s Capital Adequacy Ratio stood strong at 25%, highlighting its financial stability and capacity to support Africa’s economic development.

Commenting on the results, Denys Denya, Afreximbank’s Senior Executive Vice President, praised the Bank’s robust performance in the first half of 2024. He emphasized the Bank’s commitment to enhancing Africa’s economic resilience by helping countries mitigate the negative effects of external challenges and advocating for the continent’s interests on the global stage.

“The strong results achieved during this period reflect the effectiveness of the Group’s strategy and its commitment to operational excellence,” Denya stated. He highlighted the Bank’s pivotal role in the implementation of the African Continental Free Trade Area (AfCFTA), noting that Afreximbank will continue to foster economic integration, industrialization, and trade across Africa.

Afreximbank remains focused on maintaining a healthy liquidity position, ensuring sound asset quality, and strengthening its institutional capacity to support Africa’s growth and development aspirations.

Financial Performance Highlights:

• Gross Income: US$1.47 billion (HY-2024) vs. US$1.12 billion (HY-2023)
• Operating Income: US$899.86 million (HY-2024) vs. US$732.17 million (HY-2023)
• Net Income: US$407.66 million (HY-2024) vs. US$345.6 million (HY-2023)
• Return on Average Equity (ROAE): 12.95% (HY-2024) vs. 12.19% (HY-2023)
• Return on Average Assets (ROAA): 2.52% (HY-2024) vs. 2.36% (HY-2023)
• Cost-to-Income Ratio: 16.98% (HY-2024) vs. 16.01% (HY-2023)

Financial Position Metrics:

• Total Assets: US$31.1 billion (HY-2024) vs. US$33.47 billion (FY2023)
• Total Liabilities: US$24.9 billion (HY-2024) vs. US$27.35 billion (FY2023)
• Shareholders’ Funds: US$6.2 billion (HY-2024) vs. US$6.12 billion (FY2023)
• Non-performing Loans Ratio (NPL): 2.52% (HY-2024) vs. 2.47% (HY-2023)
• Capital Adequacy Ratio (Basel II): 25.13% (HY-2024) vs. 23.77% (FY2023)

About Afreximbank African Export-Import Bank (Afreximbank) is a Pan-African multilateral financial institution mandated to finance and promote intra-and extra-African trade. For 30 years, the Bank has been deploying innovative structures to deliver financing solutions that support the transformation of the structure of Africa’s trade, accelerating industrialization and intra-regional trade, thereby boosting economic expansion in Africa. A stalwart supporter of the African Continental Free Trade Agreement (AfCFTA), Afreximbank has launched a Pan-African Payment and Settlement System (PAPSS) that was adopted by the African Union (AU) as the payment and settlement platform to underpin the implementation of the AfCFTA. Working with the AfCFTA Secretariat and the AU, the Bank is setting up a US$10 billion Adjustment Fund to support countries effectively participating in the AfCFTA. At the end of December 2023, Afreximbank’s total assets and guarantees stood at over US$37.3 billion, and its shareholder funds amounted to US$6.1 billion. Afreximbank has investment grade ratings assigned by GCR (international scale) (A), Moody’s (Baa1), Japan Credit Rating Agency (JCR) (A-) and Fitch (BBB). Afreximbank has evolved into a group entity comprising the Bank, its impact fund subsidiary called the Fund for Export Development Africa (FEDA), and its insurance management subsidiary, AfrexInsure (together, “the Group”). The Bank is headquartered in Cairo, Egypt.

Below-Mr. Denys Denya, Afreximbank’s Senior Executive Vice President