African Export-Import Bank (Afreximbank) has announced a 4.53% increase in Net Interest Income to $411.2 million in Q1 2025, alongside a 21% surge in Net Income, demonstrating robust financial performance and strategic expansion across Africa and the Caribbean
[dropcap]T[/dropcap]he African Export-Import Bank (Afreximbank) has reported a strong financial performance for the first quarter of 2025, with its Net Interest Income growing by 4.53 per cent to reach $411.2 million, compared to the previous year.
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This positive update was released by Vincent Musumba, Afreximbank’s Communications and Events Manager, detailing the financial statements of the bank and its subsidiaries for Q1 2025.
According to Musumba, the increase in Net Interest Income was primarily driven by a growth in interest-earning assets, effectively complemented by the bank’s adept management of borrowing costs.
These factors helped to mitigate a marginal decline in total interest income, which was influenced by a softening of benchmark rates.
The bank also saw robust growth in fee income, with Guarantees and Letters of Credit experiencing increases of 47 per cent and 36 per cent respectively.
While advisory fees were lower, these gains contributed to a total unfunded income of $26.9 million for Q1 2025.
Although this represented a 7.41 per cent decrease from $29.0 million in Q1 2024, Musumba noted that the strong performance in Off-balance sheet assets aligns with the bank’s strategy to expand its unfunded business.
Afreximbank posted a commendable Net Income of $215 million, marking a 21 per cent year-on-year increase from the $178 million recorded in the prior period.
The group’s total assets and contingent liabilities expanded by 6.4 per cent, reaching $42.7 billion as of March 31, up from $40.1 billion at the close of FY2024.
On-balance sheet assets grew by 4.85 per cent to $37.0 billion, largely propelled by a 58 per cent surge in cash balances, now at $7.4 billion.
Off-balance sheet assets, encompassing letters of credit and guarantee volumes, increased by 19 per cent to $5.7 billion by the end of Q1 2025.
Net loans and advances stood at $27.8 billion in Q1 2025, a slight decrease from the FY2024 closing position.
With solid profitability growth, improved liquidity, and a well-capitalised balance sheet, the group is well-positioned to support economic transformation and sustainable development in Africa and the Caribbean.
This reduction reflects early repayments from certain customers, attributed to an improved foreign currency balance position for some sovereign borrowers.
Importantly, the Loan Asset Quality remained robust, with the Non-Performing Loans (NPL) ratio at 2.44 per cent, a modest increase from 2.33 per cent in FY2024, but still comfortably below the bank’s strategic NPL ceiling of four per cent.
Operating expenses increased by 23 per cent, reaching $75.4 million by March 31, driven by inflationary pressures and rising personnel costs.
Despite this, the Afreximbank Group maintained a healthy Cost-to-Income Ratio of 16 per cent, staying well below its strategic range of 17-30 per cent.
The bank’s liquidity profile strengthened considerably, with liquid assets now comprising 20 per cent of total assets, an increase from 13 per cent at the close of FY2024.
This heightened liquidity position is a result of successful fundraising efforts coupled with loan repayments received during the quarter.
Shareholders’ funds also increased by 3.4 per cent, reaching $7.5 billion, propelled by strong internally generated capital of $215.4 million and new equity investments under the second General Capital Increase (GCI II) programme.
In terms of operational highlights, Afreximbank and the Government of Kenya ratified several initiatives aimed at supporting the development of Industrial Parks (IPs) and Special Economic Zones (SEZs) in Kenya under the $3 billion Kenya country programme.
These projects, including Dongo Kundu Industrial Park in Mombasa and Naivasha SEZ II in Mai Mahiu, are crucial to Kenya’s Vision 2030 plan for boosting export manufacturing and industrialisation.
Afreximbank’s support is expected to enhance infrastructure, attract investment, and strategically position Kenya as a key hub for African and global commerce.
Furthermore, the rollout of the Pan-African Payments and Settlement System (PAPSS) continues to gain momentum, with KCB Group in Kenya and Bank of Kigali in Rwanda becoming the first banks to offer seamless, instant, and affordable cross-border payments in local currencies.
The bank also marked its expansion into the Caribbean with a groundbreaking ceremony for the first Afreximbank African Trade Centre (AATC) outside Africa in Bridgetown, Barbados.
Mr Denys Denya, Afreximbank’s Senior Executive Vice-President, affirmed that the Q1 2025 results were in line with expectations, reflecting a strong and resilient financial performance despite ongoing macroeconomic challenges.
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He concluded, “With solid profitability growth, improved liquidity, and a well-capitalised balance sheet, the group is well-positioned to support economic transformation and sustainable development in Africa and the Caribbean.”
