Moody's Assigns ‘Stable Outlook’ Rating to AFC

Logo of Africa Finance Corporation

The Africa Finance Corporation on Thursday revealed that its international credit rating has been re-affirmed at A3/P2 (Stable outlook) by Moody’s Investors Service.

Moody’s assigned the corporation its first international credit rating of A3 (long term) /P2 (short term) foreign currency debt rating in March 2014, according to a statement.

Moody’s rationale for confirming the investment grade rating was based on AFC’s sound capital adequacy position, owing to good equity buffers and low debt levels, as well as a strong prudential framework that supports a high degree of liquidity.

Additionally, the corporation’s treasury portfolio was adjudged liquid with no exposure to structured finance instruments or derivatives.

“AFC implements stringent prudential ratios that aim over time to ensure sound capital adequacy and to reduce credit risk to the Corporation’s expanding portfolio,” the statement added.

Moody’s also noted that a continued rise in AFC’s profitability, which does not lead to a deterioration in asset quality, could exert further upward and positive pressure on the rating.

Commenting on the rating, the President/Chief Executive Officer, AFC, Andrew Alli said: “Maintaining our international credit rating first issued in 2014 is an extremely positive achievement for the Corporation as a leading supranational development finance institution in Africa and testifies to the rigorous investment processes that have been in place since inception in 2007.

“This rating, together with the strong capital position and the quality of our portfolio, will enable AFC to grow its balance sheet at a measured pace, broaden its asset and lender base and continue to expand its geographical footprint. It is extremely encouraging to see that our world-class corporate governance structure has been recognised.”