By Adedapo Adesanya
The African Export-Import Bank (Afreximbank) has released its consolidated financial statements for the first three months of 2024, recording growth in the face of challenging geopolitical and macroeconomic conditions.
According to a statement, the Cairo-based lender demonstrated year-on-year growth and improvement in operating efficiency, with a lower cost-to-income ratio of 14.5 per cent in Q1 2024 compared with the 16.8 per cent recorded in the same period of 2023, achieved despite a 10.6 per cent increase in operating expenses to $61.4 million from Q1 2023’s $55.5 million.
In the period under review, the company grew its Net Interest Income by 31.7 per cent to $393.4 million from $298.6 million as a result of a 40.1 per cent increase in interest income to $721.8 million on the back of the growth in its portfolio of Loans and advances.
Net Interest Margin improved to 4.8 per cent from 4.4 per cent in the corresponding period due to a combination of higher benchmark rates and effective management of borrowing costs.
Staff costs rose by 28.6 per cent year-on-year following an increase in staff headcount to support the growth of group business and other initiatives, in line with the Bank’s Sixth Strategic Plan, constituting 52.9 per cent of the group’s expenses.
Group Total assets closed the first quarter of 2024 at $32.8 billion compared to $33.5 billion as of 31 December 2023 (Full Year 2023).
Cash and cash equivalents closed the period at $4.9 billion (versus $5.6 billion in 2023) with the Liquidity ratio remaining strong at 14.9 per cent.
The group’s Shareholders’ Funds rose by 2.9 per cent to $6.3 billion as of 31 March 2024 (FY 2023: $6.1 billion) on the back of growth in Group Net income of $178.7 million.
Also, callable capital, a significant proportion of which was credit enhanced as part of the bank’s Capital Management Strategy was maintained at $3.7 billion as of 31 March 2024 (FY 2023: $3.7 billion).
Speaking on the results, Mr Denys Denya, Afreximbank’s Senior Executive Vice President, said, “During the first quarter of the financial year 2024, Afreximbank Group delivered a strong performance even as we expanded our subsidiary companies’ operations and our activities in the Caribbean.
“Looking ahead, we will continue to prioritise revenue and quality assets growth, and operational efficiency, while ensuring capital adequacy and adequate liquidity levels are maintained. Focusing on these key areas will enhance the Group’s ability to execute its strategy and initiatives as outlined in its Sixth Strategic Plan.”
“The implementation of the African Continental Free Trade Area (AfCFTA) strongly supported by a robust payments and settlement system like PAPSS, is poised to strengthen the continent’s economic resilience by providing a shield against volatility on the international scene.
“Consequently, Africa is projected to sustain its resilience in 2024 and attain a growth rate of approximately 4 per cent. We look forward to the rest of the year with confidence,” he added.
