Afreximbank Posts $215M Q1 Profit Amid Liquidity Boost and Capital Strength

The African Export-Import Bank (Afreximbank) has announced a 21% increase in net income for the first quarter of 2025, fueled by improved liquidity, stronger capital reserves, and higher interest income, even as global macroeconomic headwinds persist.

For the period ending March 31, 2025, the bank reported a net profit of $215 million, up from $178 million in Q1 2024, according to its consolidated financial statements. The Group’s total assets and contingent liabilities grew by 6.4% year-on-year, reaching $42.7 billion, supported by a 58% jump in cash balances and a 19% rise in off-balance sheet items such as letters of credit and guarantees.

“Our Q1 2025 results, which met expectations, reflect a strong and resilient financial performance despite ongoing macroeconomic challenges,” said Denys Denya, Senior Executive Vice President of Afreximbank. “With solid profit growth, improved liquidity, and a well-capitalised balance sheet, we are well-positioned to continue supporting Africa and the Caribbean in their economic transformation journeys.”

Key Financial Highlights:

• Net interest income rose by 4.5% to $411.2 million, driven by growth in interest-generating assets and reduced borrowing costs, even as total interest income saw a slight dip due to falling benchmark rates.

• Fee income from letters of credit and guarantees surged by 36% and 47%, respectively. However, total unfunded income declined by 7.4% to $26.9 million, attributed to lower advisory fees.

• Loan quality remained strong, with the non-performing loan (NPL) ratio at 2.44%, well below the bank’s 4% ceiling.

The Group’s on-balance sheet assets increased by 4.85%, totaling $37 billion, while net loans and advances slightly declined to $27.8 billion. The bank attributed this to early repayments by sovereign borrowers who experienced foreign currency gains.

Liquidity Gains and Capital Base:

Afreximbank’s liquidity position saw significant improvement, with liquid assets rising to 20% of total assets, up from 13% at the end of 2024. Shareholders’ equity increased by 3.4% to $7.5 billion, bolstered by retained earnings and continued injections through the bank’s General Capital Increase (GCI II) initiative.

Although operating expenses rose 23% to $75.4 million, mainly due to inflationary pressures and increased personnel costs, the bank maintained a low cost-to-income ratio of 16%, staying below its target range.

Strategic and Regional Impact:

On the development front, Afreximbank progressed in its regional integration agenda by investing in industrial parks and special economic zones in Kenya under a $3 billion country support programme. Projects include key components of Kenya’s Vision 2030, such as the Dongo Kundu Industrial Park and Naivasha SEZ II.

Meanwhile, its flagship Pan-African Payments and Settlement System (PAPSS) continued its expansion. KCB Group (Kenya) and Bank of Kigali (Rwanda) became the first to launch the platform in East Africa, enabling real-time cross-border payments in local currencies.

In a historic move beyond the African continent, the bank also began construction on its first African Trade Centre in the Caribbean, located in Bridgetown, Barbados. The centre will house Afreximbank’s regional office for the Caribbean and serve as a strategic hub for trade between Africa and the Global South.

With a strengthened financial position and a growing regional footprint, Afreximbank continues to reinforce its role as a pivotal development financier for Africa and its diaspora.

Last Updated on May 23, 2025 by samboad