Bank Aims To Raise $ 500 million.
THE African Export and Import Bank ( Afrexim) is targeting to raise capital through equity to a tune of US$ 500 million by the end of the year to enable it provide reliable assistance to more African businesses.
Outgoing chairman of the Afrexim general meeting Denny Kalyalya said the bank has embarked on an equity raising programme aimed at bringing in additional capital of US$ 500 million to ensure that capital is not a constraint to the bank’s growth and capacity to underwrite more business in response to the needs of the continent.
Dr Kalyalya, who is also Bank of Zambia governor, said apart from the continent witnessing weak balance of payment positions on the back of falling commodity prices, Africa has also witnessed a reduction in credit lines to support businesses, hence the need for the bank to ensure that it provides adequate finance to mitigate the impact.
“ Other challenges unique to the continent have arisen from the deleveraging of international banks from the continent through cuts in credit lines, reduced on- boarding of African- based clients as well as a disproportionate increase in pricing relative to the risk, which risk is in many instances more perceived rather than real,” he said.
He said this yesterday at the Afrexim annual general meeting.
Dr Kalyalya also said the bank developed the countercyclical trade liquidity facility (COTRALF) to provide foreign currency liquidity to African central banks, disbursing in excess of US$ 3 billion so far.
Meanwhile, Dr Kalyalya said Afrexim Bank has increased its income by 25 percent, representing US$ 134.21 million at the end of 2015 from US$ 106.97 million in 2014 . Shareholders’ funds also rose by about 38 percent to US$ 1.27 billion from US$ 919 million in 2014, on the back of capital injections from the capital raising initiative.
He explained that the shareholders’ funds have since gone up to a level of US$ 1.52 billion since the beginning of the year to date.