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Moody's confirms A3/P2 rating for AFC

Lagos, 22 April, 2015 Africa Finance Corporation (AFC), the leading African  investment grade rated multilateral development finance institution, established in 2007,  has today had its international credit rating reaffirmed at A3/P2 (Stable outlook) by Moody’s Investors Service (“Moody’s”).  Moody’s assigned the Corporation its first International credit rating of A3 (long term) /P2 (short term) foreign currency debt rating in March 2014. 
 
Moody’s rationale for confirming this investment grade rating is 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 is 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.  Moody’s also notes 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. More information is available at  https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_180059
 
AFC was established in 2007 as a private sector-le d Pan African multilateral development finance institution, with an initial capital base of USD1.1 billion, to be a catalyst for private sector infrastructure investment across Africa.  AFC was established to help fill a critical void in providing project structuring expertise and risk capital to address Africa’s infrastructure development needs.  AFC not only provides access to finance, deal structuring and sector technical expertise, but also advisory services, project development capacity, and funding to bridge the infrastructure investment and access deficits, in the core infrastructure sectors of power, natural resources, heavy industry, transport and telecommunications,  all critical pillars for economic growth across Africa.
 
Commenting on the confirmation of the rating, Andrew Alli, President & Chief Executive Officer, AFC 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 recognized. This leaves the Corporation well placed to continue to create value for all stakeholders and to continue to  accelerate economic growth and industrial development in Africa.”

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