African Export-Import Bank — Moody’s
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<p style=”position:absolute;top:155px;left:108px;white-space:nowrap” class=”ft00″><b>Research Announcement: </b></p>
<p style=”position:absolute;top:155px;left:364px;white-space:nowrap” class=”ft01″><b>Moody’s – Afreximbank’s credit profile</b></p>
<p style=”position:absolute;top:180px;left:108px;white-space:nowrap” class=”ft01″><b>supported by trade finance business model and varied funding sources</b></p>
<p style=”position:absolute;top:216px;left:108px;white-space:nowrap” class=”ft02″>New York, July 15, 2020 –</p>
<p style=”position:absolute;top:257px;left:108px;white-space:nowrap” class=”ft05″>» Leverage is relatively high, but remains within the bank’s target range in risk-weighted terms<br/>» Borrower quality constrains development asset credit quality, but is mitigated by high degree of</p>
<p style=”position:absolute;top:307px;left:127px;white-space:nowrap” class=”ft03″>collateralization</p>
<p style=”position:absolute;top:343px;left:108px;white-space:nowrap” class=”ft02″>The credit profile of African Export-Import Bank (Afreximbank, Baa1 stable) is supported by its</p>
<p style=”position:absolute;top:362px;left:108px;white-space:nowrap” class=”ft02″>collateralized trade finance business model, with a short average asset maturity of 20 months and a</p>
<p style=”position:absolute;top:382px;left:108px;white-space:nowrap” class=”ft02″>relatively well-diversified loan portfolio that has allowed it to respond flexibly to the coronavirus crisis,</p>
<p style=”position:absolute;top:401px;left:108px;white-space:nowrap” class=”ft06″>Moody’s Investors Service said in a report this week.<br/>Moreover, its shareholder base has increased to 156 members at the end of 2019 from 150 in 2018.</p>
<p style=”position:absolute;top:451px;left:108px;white-space:nowrap” class=”ft02″>Paid-in capital also includes freely tradeable depositary receipts linked to Class D shares, which</p>
<p style=”position:absolute;top:470px;left:108px;white-space:nowrap” class=”ft06″>provide an additional source of equity capital.<br/>“Afreximbank’s credit profile benefits from its established access to a varied range of funding sources</p>
<p style=”position:absolute;top:520px;left:108px;white-space:nowrap” class=”ft02″>at competitive terms, which mitigate the risks arising from the bank’s relatively tight liquidity profile</p>
<p style=”position:absolute;top:540px;left:108px;white-space:nowrap” class=”ft02″>compared to other rated multilateral development banks that lend on a longer-term and unsecured</p>
<p style=”position:absolute;top:559px;left:108px;white-space:nowrap” class=”ft06″>basis,” said Elisa Parisi-Capone, a Moody’s Vice President – Senior Analyst and the report’s author.<br/>The stable outlook on the bank’s rating is supported by its successful equity-raising performance and</p>
<p style=”position:absolute;top:609px;left:108px;white-space:nowrap” class=”ft02″>its record of adapting its strategy to challenges in the operating environment of member countries</p>
<p style=”position:absolute;top:628px;left:108px;white-space:nowrap” class=”ft02″>without undermining its asset-quality performance. The outlook also reflects Moody’s expectation</p>
<p style=”position:absolute;top:648px;left:108px;white-space:nowrap” class=”ft02″>that the risks associated with the bank’s Pandemic Trade Impact Mitigation Facility (PATIMFA) will be</p>
<p style=”position:absolute;top:667px;left:108px;white-space:nowrap” class=”ft06″>managed without persistent detriment to leverage and asset quality metrics.<br/>Upward credit pressure could arise from higher capital and liquidity buffers which remain among the</p>
<p style=”position:absolute;top:717px;left:108px;white-space:nowrap” class=”ft02″>lowest among rating peers. Conversely, a sustained weakening of asset quality, increased liquidity</p>
<p style=”position:absolute;top:737px;left:108px;white-space:nowrap” class=”ft06″>pressures or a continued expansion in the leverage ratio could lead to a downgrade.<br/>Subscribers can access the report at: </p>
<p style=”position:absolute;top:767px;left:372px;white-space:nowrap” class=”ft04″>http://www.moodys.com/researchdocumentcontentpage.aspx?</p>
<p style=”position:absolute;top:787px;left:108px;white-space:nowrap” class=”ft04″>docid=PBC_1233342</p>
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<p style=”position:absolute;top:945px;left:701px;white-space:nowrap” class=”ft02″> for the most</p>
<p style=”position:absolute;top:964px;left:108px;white-space:nowrap” class=”ft06″>updated credit rating action information and rating history.<br/>Elisa Parisi-Capone</p>
<p style=”position:absolute;top:1014px;left:108px;white-space:nowrap” class=”ft02″>VP-Senior Analyst</p>
<p style=”position:absolute;top:1033px;left:108px;white-space:nowrap” class=”ft02″>Sovereign Risk Group</p>
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<p style=”position:absolute;top:468px;left:108px;white-space:nowrap” class=”ft02″>the document as a representative of, a “wholesale client” and that neither you nor the entity you</p>
<p style=”position:absolute;top:488px;left:108px;white-space:nowrap” class=”ft02″>represent will directly or indirectly disseminate this document or its contents to “retail clients” within</p>
<p style=”position:absolute;top:507px;left:108px;white-space:nowrap” class=”ft02″>the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as</p>
<p style=”position:absolute;top:527px;left:108px;white-space:nowrap” class=”ft02″>to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or</p>
<p style=”position:absolute;top:546px;left:108px;white-space:nowrap” class=”ft07″>any form of security that is available to retail investors.<br/>Additional terms for Japan only: Moody’s Japan K.K. (“MJKK”) is a wholly-owned credit rating agency</p>
<p style=”position:absolute;top:589px;left:108px;white-space:nowrap” class=”ft02″>subsidiary of Moody’s Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc.,</p>
<p style=”position:absolute;top:608px;left:108px;white-space:nowrap” class=”ft02″>a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating</p>
<p style=”position:absolute;top:628px;left:108px;white-space:nowrap” class=”ft02″>agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization</p>
<p style=”position:absolute;top:647px;left:108px;white-space:nowrap” class=”ft02″>(“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-</p>
<p style=”position:absolute;top:667px;left:108px;white-space:nowrap” class=”ft02″>NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated</p>
<p style=”position:absolute;top:686px;left:108px;white-space:nowrap” class=”ft02″>obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit</p>
<p style=”position:absolute;top:706px;left:108px;white-space:nowrap” class=”ft02″>rating agencies registered with the Japan Financial Services Agency and their registration numbers</p>
<p style=”position:absolute;top:725px;left:108px;white-space:nowrap” class=”ft07″>are FSA Commissioner (Ratings) No. 2 and 3 respectively.<br/>MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including</p>
<p style=”position:absolute;top:768px;left:108px;white-space:nowrap” class=”ft02″>corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated</p>
<p style=”position:absolute;top:787px;left:108px;white-space:nowrap” class=”ft02″>by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to</p>
<p style=”position:absolute;top:807px;left:108px;white-space:nowrap” class=”ft02″>MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging</p>
<p style=”position:absolute;top:826px;left:108px;white-space:nowrap” class=”ft07″>from JPY125,000 to approximately JPY250,000,000.<br/>MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory</p>
<p style=”position:absolute;top:869px;left:108px;white-space:nowrap” class=”ft02″>requirements.</p>
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