Business
‘Afreximbank needs increased capital to remain relevant’
The outgoing president of Afreximbank, Mr Jean-Louis Ekra, on Monday said that the bank needed more capitalisation to remain relevant to African needs.
Ekra, who made the observation at a valedictory speech in Cairo, said that the huge trade financing gap in Africa required higher level of capitalisation for the bank.
He said that a recent study by the African Development Bank indicated that the continent had trade financing gap of $120 billion annually — an indication that more work needed to be done by the bank.
The outgoing bank president commended shareholders for their overwhelming support for successfully raising the paid up capital of the bank during the last exercise.
“I take this opportunity to call on our shareholders to continue the support they have shown over the years to ensure that Afreximbank remains relevant to confronting the challenges facing the continent,” he said.
Ekra said that in spite of the challenges the bank faced during his tenure, Afreximbank grew its total assets by 10-fold from half a billion dollar in 2006 to six billion dollar in 2015.
He said that the bank’s loans and advances accounted for over 80 percent of the total assets during the period.
The bank’s net earnings also grew five-fold from $20 million in 2006 to $104 million at the end of 2014.
“Sources of the earnings became more diversified with advisory fees accounting for over 25 percent of total revenues during the period,” he said.
Ekra said that as the financial results remained remarkable over the years, the development impact of the bank also gave him more gratification.
He said that the bank had built strong brand recognition in major financial markets around the world.
The bank executive said that the bank received trail-blazing investment grade ratings by the three major global rating agencies at the height of the global financial crisis in 2008 and 2009.
“It is my belief that we could and should have done more to get the big three credit rating agencies to better understand Afreximbank’s unique business model.
“At the bank, we are very proud to have opened the gate of investment grade rating to other African financial institutions.
“However, I am in no doubt that the bank deserves a higher credit rating than is currently assigned it,” he said.
Amb. Mohamed Edrees, the Assistant Foreign Minister for African Affairs in Egypt, commended the achievements of Ekra, in spite of the crisis which rocked the bank during his tenure.
He said that the success story of the bank indicated that big ideas could be implemented to a success end by great minds, in spite of challenges.
Edrees commended the smooth leadership transition taking place in the bank since its inception. (NAN)
