BY KENNETH EZE
As part of efforts to expand capacity for delivery on its core mandate and diversify range of services, the African Export-Import Bank has embarked on a $6.5 billion General Capital Increase.
President of Afreximbank, Prof. Benedict Oramah, said, “I would like to thank Afreximbank shareholders for their support towards this important exercise.”
He added that the GCI would enable Afreximbank to significantly increase its efforts to promote intra-African trade, drive export development and accelerate the continent’s recovery from the economic difficulties caused by COVID-19.
“This is a historic moment for the Bank; it presents a great opportunity to deepen the Bank’s capacity to deliver transformative growth across this continent,” the President added.
According to a statement released electronically by the bank on Thursday, The African Union Ministers of Finance, the AU Executive Council, and the 34th Ordinary Session of the AU Assembly of Heads of State endorsed the additional capitalisation of Afreximbank in recognition of the bank’s mandate and pivotal role.
To actualise this, the statement disclosed that African member states are expected to contribute up to $1.5 billion as paid-in capital ($3.9 billion in callable capital) to meet their total contribution under the GCI.
Similarly, the bank’s Board of Directors opened the GCI to other shareholders to contribute up to $1.1 billion to enable them participate pro-rata to their shareholding in Afreximbank, bringing the total size of the GCI to $6.5 billion (of which $2.6 billion will be paid-in).
The GCI was approved by Afreximbank Shareholders during the 28th annual meeting in July 2021, the statement also revealed.
With this, the bank expects to double its annual lending capacity and balance sheet size during the next five years, which would see it contributing more to the reduction of the existing annual trade finance gap in Africa.
