Africa Finance Corporation (AFC) has been assigned a long-term Issuer credit rating of A+ with a stable outlook by the Japan Credit Rating Agency, Ltd (JCR). The rating will enable AFC to continue growing its footprint in Asian capital markets.
JCR in its report said “The credit rating reflects AFC’s leading role in infrastructure development in Africa, the strong support from its member states and shareholders, the benefits of Preferred Creditor Status (PCS), its conservative financial policy, and its strong capital base.
“AFC employs diverse funding channels, including Eurobond issuance in international capital markets; borrowing from MDBs such as the African Development Bank, PROPARCO, DEG/FMO, KFW group, Export-Import Bank of China, Korea Development Bank, etc.; and financing from African, Chinese, European, Indian, Japanese and Middle Eastern private financial institutions.”
The Japan Credit Rating Agency’s A+ rating reflects AFC’s continued demonstration of solid capital adequacy, maintaining a Capital Adequacy Ratio of 33.6 per cent and improving its Cost-to-Income Ratio to 17.3 per cent in full year ending 2024. In 2024, AFC delivered remarkable financial results, posting a 22.8 per cent increase in revenue to surpass $1 billion for the first time, as well as a 16.7 percent rise in total assets to $14.41 billion. Liquidity buffers remain well above prudential thresholds, with a liquidity coverage ratio of 194% under normal conditions and 191 per cent on a stressed basis, underscoring AFC’s resilience.
JCR’s rating decision supports the Corporation’s ability to secure competitive borrowing costs. This financial strength underpins AFC’s ability to deliver transformational infrastructure projects across power, natural resources, transport and logistics, heavy industry, telecommunications, and technology—driving industrialisation and job creation across the continent.
A notable example is the Lobito Corridor, where AFC serves as lead developer. Positioned to become one of Africa’s most strategic economic arteries, the corridor will connect Angola’s Port of Lobito on the Atlantic coast to Zambia through modernised rail infrastructure, enhancing regional trade, unlocking mineral value chains, and catalysing cross-border economic integration.
Leading Japanese financial institutions—Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation have been critical partners supporting AFC on its journey of transforming Africa, participating in multiple funding transactions including bilateral, syndicated and Samurai facilities. This partnership has extended beyond AFC’s own capital-raising efforts to broader support for African issuers. A notable example is the Arab Republic of Egypt’s inaugural Samurai Bond, where AFC acted as re-guarantor and SMBC served as guarantor, facilitating a successful JPY 75 billion private placement.
JCR analysts noted that “In the challenging business environment, with increasing geopolitical instability in some African countries, AFC’s role in advancing infrastructure development in Africa as an MDB established by African countries is becoming more important, and support from member states and shareholders is expected to strengthen.
“AFC conducts appropriate risk management in the challenging business environment in Africa, ensuring strong profitability and building a sound financial structure. AFC has established risk management policies for various risks associated with its operations, including credit risk, market risk, liquidity risk, operational risk, assets and liabilities management (ALM) risk, and environmental/social policy risks,” they further reported.
Executive board member & head, Financial Services at AFC, Banji Fehintola,commenting on the rating said “Amidst a challenging global macroeconomic backdrop, this endorsement by JCR affirms AFC’s financial strength and credibility, enhancing our ability to mobilise competitively priced capital for transformative infrastructure projects across Africa. It reinforces our position as a reliable institutional partner for Japan and a key driver of Africa-Japan cooperation.”
Some of AFC’s landmark funding initiatives include the successful issuance of its US$500 million perpetual hybrid bond, the closing of a US$400 million Shariah-compliant Commodity Murabaha, and leading Nigeria’s inaugural domestic dollar bond issuance, which raised over US$900 million, with an oversubscription rate of 180 per cent. These transactions underscore the Corporation’s innovative approach to capital markets, diversifying funding sources and enhancing its ability to finance transformational infrastructure projects across Africa.
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