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0, 115, 110 211, 219, 218 Afreximbank 238, 236, 225 Systemic bank at the epicentre of intermediating 249, 249, 245 Africa’s trade growth July 2019 Table colors Color palette Soft colors
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Disclaimer
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DISCLAIMER
Lines 0, 170, 140 IMPORTANT: Please read the following before continuing. The following applies to this document and the information contained therein, the oral presentation by the African Export-Import Bank (the 211, 230, 224 191, 191, 191 “Bank”) or any person on behalf of the Bank, and any question-and-answer session that follows the oral presentation (collectively, the “Information”). The Information has been prepared by the Bank for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the Information or its accuracy, fairness or completeness. The Information and opinions contained herein are provided as at the date of this presentation and are subject to change without notice. This presentation is the sole responsibility of the Bank and has not been reviewed or approved by any regulatory or supervisory authority.
The Information is not intended for potential investors and does not constitute or form part of, and should not be construed as an offer or the solicitation of an offer to subscribe for or purchase 155, 187, 89 227, 234, 216 securities of the Bank, and nothing contained therein shall form the basis of or be relied on in connection with any contract or commitment whatsoever. You acknowledge that all or part of the Information may constitute material non-public information and you agree that you will not use such information or take any action in any way that might give rise to any infringement of law, regulations or restrictions in this regard. To the extent available, the industry, market and competitive position data contained in the Information come from official or third party sources. Third party industry publications, studies and surveys generally state that the data contained therein has been obtained from sources believed to be reliable, but that there is no guarantee of the accuracy or completeness of such data. While the Bank reasonably believes that each of these publications, studies and surveys has been prepared by a reputable party, neither the Bank nor any of the Bank’s directors, officers, employees, agents, affiliates, advisors or agents, have independently verified the data contained therein. In addition, certain industry, market and competitive position data 128, 128, 128 221, 221, 221 contained in the Information come from the Bank’s internal research and estimates based on the knowledge and experience of the Bank’s management in the markets in which the Bank operates. While the Bank reasonably believes that such research and estimates are reasonable, they, and their underlying methodology and assumptions, have not been verified by any independent source for accuracy or completeness and are subject to change. Accordingly, reliance should not be placed on any of the industry, market or competitive position data contained in the Information.
This presentation includes certain operational and financial measures not presented in accordance with IFRS and, therefore, are not measures of financial performance in accordance with IFRS and may exclude items that are significant in understanding and assessing the Bank’s financial results or future prospects. Therefore, these measures should not be considered in isolation or as an 191, 191, 191 alternative performance measures under IFRS. You should be aware that the Bank’s presentation of these measures may not be comparable to similarly-titled measures used by other companies. 235, 235, 235
The Information does not purport to be comprehensive. To the fullest extent permitted by law, neither the Bank nor any of the Bank’s directors, officers, employees, agents, affiliates, advisors or agents, accepts any responsibility or liability whatsoever for (whether in contract, tort or otherwise) or makes any representation, warranty or undertaking, express or implied, as to the truth, fullness, fairness, accuracy or completeness of the Information (or whether any information has been omitted from it) or any other information or opinion relating to the Bank, its subsidiaries, affiliates or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the Information or 0, 115, 110 otherwise arising in connection therewith. In giving this presentation, neither the Bank nor any of the Bank’s directors, officers, employees, agents, affiliates, advisors or agents, undertake any 211, 219, 218 obligation to provide the recipient(s) with access to any additional information or to update the Information, or to correct any inaccuracies in the Information, including any data or forward-looking statements.
The Information may include forward-looking statements, which are based on current expectations and projections about future events. These statements may include, without limitation, any statements preceded by, followed by or including words such as “target”, “believe”, “expect”, “aim”, “intend”, “may”, “anticipate”, “estimate”, “plan”, “project”, “will”, “can have”, “likely”, “should”, “would”, 238, 236, 225 “could” and any other words and terms of similar meaning or the negative thereof. These forward-looking statements are subject to risks, uncertainties and assumptions about the Bank and its 249, 249, 245 subsidiaries and its investments, including, among other things, the development of its business, strategy, trends in its operating environment, and future capital expenditures and acquisitions. In light of these risks, uncertainties and assumptions, the events in the forward-looking statements may not occur. No representation or warranty is made that any forward-looking statement will come to pass. No one undertakes to update, supplement, amend or revise any such forward-looking statement. Except where otherwise indicated, the Information and the opinions contained therein are provided as at the date of the presentation and are subject to change without notice.
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Today’s presenters
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191, 191, 191 235, 235, 235 Dr. George Elombi Mr. Amr Kamel Mr. Denys Denya EVP – Governance, Legal & Corporate EVP – Business Development and EVP – Finance, Administration and Services Corporate Banking Banking Services
0, 115, 110 211, 219, 218
EVP of Governance, Legal & Corporate EVP of Business Development & EVP of Finance, Administration and Services since 2015 Corporate Banking since 2016 Banking Services since 2010
Over 23 years with the Bank Over 24 years with the Bank Previous executive positions with Nedbank 238, 236, 225 and First Merchant Bank (Zimbabwe) 249, 249, 245
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238, 236, 225 249, 249, 245 Executive summary Table colors Color palette Soft colors
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Gateway to Africa with access to 55 countries in the continent
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Developmental Preferred 0% Lines Unique position in 0, 170, 140 mandate with creditor Tax and customs in 211, 230, 224 191, 191, 191 Africa with a profit-driven status Participating States differentiated mandate philosophy
155, 187, 89 227, 234, 216
~US$71bn ~US$7bn US$1.8bn At the epicenter of Trade financing Disbursement of Commitment to support since trade financing deals manufactured export 128, 128, 128 221, 221, 221 Africa's trade inception in 2018 in 2018
191, 191, 191 235, 235, 235 ~US$15bn ~27% ~11.8% Robust and growing Total assets as of Net loan CAGR RoAE in 2018 with balance sheet and March 2019 2014 - 1Q19 with US$0.3bn net income <3% NPL ratio 0, 115, 110 profitability… 211, 219, 218
238, 236, 225 Mauritius stock US$2.1bn Baa1 / BBB- 249, 249, 245 …enabled by exchange listing Bonds outstanding Credit rating assigned best-in-class market by Moody’s / Fitch experience
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Headings 0, 115, 110 211, 219, 218 255, 255, 255 Differentiated mandate with a development focus while delivering robust returns to our shareholders
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• Transforming African trade
Lines Consistently 0, 170, 140 • Client / trade support at times • Best-in-class cost efficiency 211, 230, 224 191, 191, 191 Development when needed most delivering • Double digit returns profile mandate • Complimenting African states’ returns to development objectives shareholders • Profit retention to fund growth 155, 187, 89 227, 234, 216 • Preferred creditor status
128, 128, 128 Context to Afreximbank’s establishment 221, 221, 221
Established in response to the global debt crisis of the 1980s
191, 191, 191 Crisis resulted in a drastic reduction in the availability of trade financing in Africa 235, 235, 235
Establishment Agreement signed in Abidjan, Cote d’Ivoire, in 1993
0, 115, 110 211, 219, 218 Provides the bank with a supranational creditor and tax status
Bank Charter, signed by all shareholders, regulates the governance of the Bank 238, 236, 225 249, 249, 245 Bank has now emerged as a cornerstone of promoting Intra-African Trade and Value-Added Exports
Bank has all the advantages of a development bank with commercial approach to operations 5
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Headings 0, 115, 110 211, 219, 218 255, 255, 255 Committed and diversified shareholder base coupled with multiple sources of long-term capital
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Unique shareholder structure capturing both commercial and development mandates of the bank (31 December 2018)
# of Paid in Callable Total As % of US$mm shareholders capital capital capital total capital Lines 0, 170, 140 May only be issued to African states, their 211, 230, 224 191, 191, 191 central bank or other designated institution, A 49 270 527 797 57.8% African Development Bank and African regional and sub-regional institutions
155, 187, 89 May be issued to African financial institutions 227, 234, 216 B 87 121 242 363 26.3% and private investors
May be issued to non-African international financial institutions or non-African foreign 128, 128, 128 C 14 46 105 151 10.9% 221, 221, 221 owned banks and financial institutions and non-African public and private investors
D GDR line, open to any person - 69 - 69 5.0% 191, 191, 191 235, 235, 235
Diversified shareholder base (31 December 2018)
# Class Shareholder % # Class Shareholder % 0, 115, 110 211, 219, 218 1 A Central Bank of Egypt 11.51% 11 B Banque Misr 3.44% 2 A Central Bank of Nigeria 6.21% 12 A Government of Congo Brazzaville 2.63% 3 D SBM Securities Limited 5.95% 13 A Banque Centrale De Tunisie 2.15% 4 B National Bank of Egypt 5.73% 14 C Standard Chartered 2.11% 238, 236, 225 5 A Reserve Bank of Zimbabwe 5.71% 15 A Bank of Uganda 2.09% 249, 249, 245 6 A Federal Republic of Nigeria 5.33% 16 B Export Credit Insurance Corporation 2.00% 7 C China Eximbank 4.43% 17 A Republique Du Cameroun 1.91% 8 A Government of Cote D'ivoire 3.96% 18 B Government Employees Pension Fund 1.91% 9 A African Development Bank 3.89% 19 C JSC Russia Export Center (REC) 1.54%
10 B Banque du Caire 3.60% 20 B Nigerian Export Import Bank 1.39% 6
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Headings 0, 115, 110 211, 219, 218 255, 255, 255 Supranational status with a low risk proposition supported by special privileges and immunities
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Supranational legal status with lower risks Preferred creditor status consistently demonstrated Exemption from all taxation and customs duties in ? Foreign currency exchange crisis in 2017 Lines Participating States 0, 170, 140 211, 230, 224 191, 191, 191 Central Bank of Egypt provided access to USD to certain No administrative, financial or other regulatory Egypt financial institutions to repay loans to Afreximbank 2017 restrictions
Immunity for property and assets from search, seizure ? Clients facing challenges accessing hard currency 155, 187, 89 227, 234, 216 and similar actions² Central Bank of Nigeria gave priority access to clients to enable them to service liabilities with Afreximbank Preferred creditor status Nigeria 2017
? Client loans of US$30.2mm behind repayment schedule 128, 128, 128 Strong growth with asset quality under control 221, 221, 221
NPL ratio¹ Zimbabwe Asset Management took over loans Zimbabwe 2016 Assets growth CAGR Dec-14 – Mar-19 27% 191, 191, 191 ? Significant hard currency shortages 235, 235, 235
Central Bank of Sudan prioritised repayment of facilities Sudan owed to Afreximbank 7.0% 2014-15
0, 115, 110 211, 219, 218 ? Kenyan government suspended payments of a series of 2.7% promissory notes, partly held by Afreximbank
Kenya Promissory notes held by Afreximbank redeemed; those 2008 held by others were not 238, 236, 225 Peer average 249, 249, 245 ? State-owned body experienced financial difficulty due to funding shortfalls from Senegalese government
Senegal Afreximbank repaid; other creditors entered into a restructuring Source: Company information 2007 arrangement Peers include Absa, Nedbank, CIB, Banque Centrale Populaire, BMCE, Guaranty Trust Bank, Zenith Bank, Equity Bank, Banque Marocaine, Credit Agricole Egypt, Ecobank Transnational, BIAT, United 7 Bank for Africa, Standard Chartered Ghana, NLB, Halyk Bank, Bank of Georgia, TBC, Atlas Mara, Bladex ¹ March 2019 for Afrexmbank, latest available for peers; ² Bank immunities are specific to its participating states Table colors Color palette Soft colors
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High standards of corporate governance and experienced management team
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Experienced management team… … complemented by strong corporate governance structure Lines 0, 170, 140 Board of Directors 211, 230, 224 191, 191, 191 Dr. Benedict Oramah 25 President PhD in Agricultural Economics obtained in 1991 Worked at Nigerian Export-Import Bank before joining the Bank as Chief Audit Remuneration Executive Analyst in 1994 Committee Committee Committee 155, 187, 89 Was appointed to Executive Vice President of the Bank in October 2008, a 227, 234, 216 position he held until his appointment as President in June 2015
Strategy and Risk Credit Committee Branch Committee Mr. Denys Denya 9 Committee EVP – Finance, Administration and Banking Services Bachelor of Accountancy and MBA degrees from the University of Zimbabwe 128, 128, 128 Fellow of the Institute of Chartered Accountants of Zimbabwe and of the 221, 221, 221 Institute of Chartered Secretaries and Administrators Senior Management Team Prior to joining Afreximbank in 2010 worked at Nedbank and MBCA Bank Mr. Denya has over 25 years of experience across Banking and Finance The Board of Directors currently consists of 12 members, four representing Class A shareholders, four representing Class B 191, 191, 191 Dr. George Elombi 23 shareholders, two representing Class C shareholders and two Independent 235, 235, 235 EVP – Governance, Legal & Corporate Services Directors LLM and a PhD in Law from the University of London Oversees the meetings of the Executive Board and General Meetings of All board members have equal voting power and decisions are made Shareholders as well as related Shareholder matters by simple majority Worked as a Lecturer with the University of Hull, UK, before joining the Bank 0, 115, 110 as Legal Officer in October 1996 None of the directors of any class may be of the same nationality 211, 219, 218 There is no dominant influence of leading countries in the decision Mr. Amr Kamel 24 EVP – Business Development and Corporate Banking making BA in Economics from the American University in Cairo; MBA in Financial All board members are technically independent of their nominating Management from City University of New York, USA 238, 236, 225 34 years of banking experience across Bank of Credit & Commerce; Bank of institutions as they cease to represent the institution when elected and 249, 249, 245 America; and Chemical Bank (currently J.P. Morgan Chase) represent the class of shareholders as a whole Joined Afreximbank in 1995 In addition, there are two independent directors who do not represent any class of shareholders x Years with Afreximbank
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Headings 0, 115, 110 211, 219, 218 255, 255, 255 Afreximbank is a systemic bank at the epicentre of intermediating Africa’s trade growth
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Lines 1 Strong secular growth drivers compounded by the booming African trade dynamics 0, 170, 140 211, 230, 224 191, 191, 191
2 Supranational status with a low-risk proposition supported by special privileges and immunities 155, 187, 89 227, 234, 216
Well-established public-private partnership model with strong international strategic 3 alliances 128, 128, 128 221, 221, 221
Highly efficient operations driven by the wholesale banking model and the use of trade 4 finance intermediaries
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5 Strong and liquid balance sheet profile with a robust capital position
0, 115, 110 211, 219, 218 6 Consistent track record of earnings supporting tax-free dividends
238, 236, 225 249, 249, 245 7 Achieves long-lasting positive developmental impact via its specific operating model and mandate
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238, 236, 225 Strategic positioning and market 249, 249, 245 opportunity Table colors Color palette Soft colors
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Africa has strong macro fundamentals and presents high growth opportunities
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Potential for Afreximbank to capitalise on the trade finance Strong GDP growth across the continent opportunities in Africa Real GDP growth (2018) Total GDP (2018, US$bn) 3% Africa’s share of global Lines US$110bn trade finance 0, 170, 140 83% of Afreximbank’s loan portfolio is located in East, West and North Africa³ trade vs.16% share of global 211, 230, 224 191, 191, 191 needs in Africa annually2 population¹
West 5.0% 641 Africa Increasing share of urban population… Urban population as % of total, Africa total 155, 187, 89 227, 234, 216 +5 p.p East 41% 4.0% 233 36% 38% 40% Africa
128, 128, 128 221, 221, 221 2005 2010 2015 2018 North 3.2% 539 … rising national income and strengthening middle class … Africa GDP per capita in constant prices, PPP, US$, Africa total +49% 191, 191, 191 235, 235, 235 Southern 4,939 5,254 2.3% 629 3,537 4,460 Africa
2005 2010 2015 2018 0, 115, 110 Central 211, 219, 218 1.8% 129 Africa … and strong foreign direct investment flows Foreign direct investments, US$bn, Africa total +58% Africa 238, 236, 225 3.4% 2,171 54 59 249, 249, 245 total 38 44
2005 2010 2015 2016 Source: IMF, AfDB, UNCTAD ¹ Africa Trade Report 2019, Afreximbank,trade data as of 2017, population data based on 2019 estimates ² As of 2017, AfDB 11 ³ As of December 2018 Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255 Strategy to further strengthen Afreximbank’s leadership position in the African trade finance market
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Afreximbank’s strategy focuses on four areas…
Lines 0, 170, 140 211, 230, 224 191, 191, 191
Industrialisation and Trade finance Financial soundness Intra-African trade 155, 187, 89 export development leadership and performance 227, 234, 216
128, 128, 128 221, 221, 221
Promote / finance intra-African Create conditions to attract Bridge the gap created by Ensure the requisite size and trade export manufacturing investors limitations of international banks financial soundness Support activities to improve Improve capacity of Africans in Ability to make a meaningfully 191, 191, 191 efficiency and quality in trade finance impact on African trade 235, 235, 235 production … enabling it to capitalise on the significant opportunities ahead
0, 115, 110 211, 219, 218 US$40bn US$25bn 5% of deals in the of trade financing to be of intra-African trade to be current pipeline¹ disbursed in 2017 – 2021 financed by Afreximbank 238, 236, 225 249, 249, 245
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Innovative and diverse product offering to access new sources of revenues
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Afreximbank’s key segments… … complemented by revenue enhancing initiatives…
Initiative Initiative name Description Lines 0, 170, 140 type 211, 230, 224 191, 191, 191 . Large scale facilities implemented between 2015- Emergency Countercyclical 2017 liquidity Trade Liquidity . Response to 2014 crash of the commodity cycle lines Facility . Resulted in 10 new countries joining the Bank 155, 187, 89 227, 234, 216 Credit Risk bearing Pan-African . Designed to formalise cross-border trade, address Guarantees Payments Payment and payment challenges and reduce costs of completing Trade and project Settlement System trade financing
. Invest into trade-focused companies across all 128, 128, 128 Private Fund For Export 221, 221, 221 market segments Equity Development . Includes start-ups, SMEs and mature companies Fee income . Products range from short term-trade guarantees Afreximbank and working capital solutions to bond facilities for 191, 191, 191 Guarantees 235, 235, 235 Advisory and Guarantee Program export and trade capital markets . Caters to mid-cap entities and SMEs services, Central Bank . Aims to harness Africa's FX reserves and support Funding Deposit/Investment syndication & the continent's trade and economic development programme 0, 115, 110 agency 211, 219, 218 … and a network of international strategic partnerships
238, 236, 225 China 249, 249, 245 EximBank
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Case study: Launch of the Pan African Payment and Settlement System (PAPSS)
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 What is PAPSS?
Central financial market infrastructure to support payment arrangements to expand international trade of African States Lines 0, 170, 140 211, 230, 224 191, 191, 191 Set up to drive economic and financial integration across Africa
A centralised payment and settlement infrastructure: Defines a common framework for transacting, clearing and settling cross-border transactions 155, 187, 89 227, 234, 216 Will operate independently of domestic payment systems Allows participants to exchange payments in local currency on daily basis
128, 128, 128 Benefits of the PAPSS 221, 221, 221
Expansion of intra-Africa trade and investment flows “The introduction of this simplified, low-cost and risk-controlled interoperable payment, clearing and settlement system will facilitate trade and other economic activities among African 191, 191, 191 235, 235, 235 Attraction of investment capital countries. In effect, it is intended to make payments under intra- African trade possible, directly, in the local currencies of all Creation of new business opportunities and African countries. If a Nigerian company wants to buy goods from employment across Africa a Ghanaian supplier, the Nigerian entity will pay for the goods in 0, 115, 110 211, 219, 218 Naira, while the Ghanaian supplier will get paid in the Ghanaian Diversification of trade Cedi. Afreximbank will do the clearing and settlement”
238, 236, 225 Liquidity cost savings Dr. Benedict Oramah 249, 249, 245 President of Afreximbank Reduction in operational costs for central and commercial banks
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Headings 0, 115, 110 211, 219, 218 255, 255, 255 Selected example of Afreximbank creating value with no balance sheet risk exposure in Zimbabwe
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Afreximbank created significant value for all parties involved Facility / loan Lines security 0, 170, 140 211, 230, 224 191, 191, 191 assignment deed How? Why?
Reserve Bank of Zimbabwe Off-shore collection Gold Develops (“RBZ”) account Special status Unmatched 155, 187, 89 proceeds African Export – Import Bank trade 227, 234, 216 provides access competitive (“Security Trustee ”) (social to unique projects advantage mandate) Financing Assignment of Gold agreement gold proceeds proceeds 128, 128, 128 221, 221, 221
Gold sales agency contract ... with no Fidelity Printers and No risk on Rand refinery Buyers exposure to the Gold-backed Refiners Ltd the balance 191, 191, 191 country macro or exposure 235, 235, 235 sheet Sale of refined FX gold and signing of Cash to Notice of purchase / buy Unrefined Assignment 0, 115, 110 211, 219, 218 gold gold
Through RBZ’s Leverage Significant fees account unparalleled paid to Gold producers held at access to drive Afreximbank 238, 236, 225 Afreximbank profits 249, 249, 245
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Strong business performance in 2018
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Selected targets for 2018 Lines 0, 170, 140 211, 230, 224 191, 191, 191 Industrialisation and Trade finance leadership Intra-African trade Financial soundness and performance export development
US$2.3bn Increase share of Provide financing 32 countries to Mobilise 155, 187, 89 disbursement in the bank’s intra- support to 6 benefit from the US$200mm in new 227, 234, 216 support of direct Africa trade loan manufacturing Afreximbank’s equity trade finance portfolio to 13% projects products
128, 128, 128 221, 221, 221
191, 191, 191 235, 235, 235
Industrialisation and export Improve business development Financial soundness and Trade finance leadership Intra-African trade development and shareholder engagement performance
Disbursed US$2.4bn vs. a Increased the share of Provided >US$1.1bn in 49 countries benefitted Raised US$338mm in new 0, 115, 110 target of US$2.3bn Afreximbank’s loan financing to support 6 from our products equity vs US$200mm 211, 219, 218 portfolio related to intra- manufacturing projects target Leveraged US$3.5 dollars in Africa trade to 25% Four new countries ratified external financing for every (vs. 13% target) Disbursed US$327mm to the Establishment Achieved CAR of 25% US$1 committed trade enabling infrastructure Agreement Facilitated Inaugural Intra- projects Achieved 12% RoAE 238, 236, 225 64 new correspondent African Trade Fair Three non-participating 249, 249, 245 banking and trade services Supported construction of countries became equity Maintained NPL ratio of 3% relationships Commenced construction of two industrial parks / special investors testing, inspection and economic zones Maintained Cost / Income US$436mm balance in certification centre ratio of 18% guarantees by the end of 2018 through AFGAP programme 16
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191, 191, 191 3 235, 235, 235
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Headings 0, 115, 110 211, 219, 218 255, 255, 255 Well-managed business with sound asset quality, strong capital position and consistently delivering double digit returns
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Balance sheet composition (US$bn, Mar-19) Key comments
15.0 15.0 Lines 2 0, 170, 140 1 Other 211, 230, 224 191, 191, 191 0.3 Other 0.4 Sizeable balance sheet of US$15bn with 2.6 3.0 Debt securities Cash >20% historical growth 2.6 Customer deposits
155, 187, 89 227, 234, 216 12.1 Net loans 6.4 Due to banks c.80% of balance sheet comprises of revenue generating loans 2.6 Shareholders’ equity 128, 128, 128 221, 221, 221 Assets Liabilities & equity
Key metrics FY’18 Q1’19 Sound asset quality with sub 3% NPL ratio and
191, 191, 191 >100% total NPL coverage (including collateral) 235, 235, 235 Gross loans CAGR (15-18) 22.7%
Cost / Income 17.9% 15.8%
0, 115, 110 211, 219, 218 RoAE3 11.8% 10.6% Efficiently managed with consistent >10% RoAE
NPL ratio4 3.0% 2.7%
238, 236, 225 249, 249, 245 Total NPL coverage5 132% 108% Strong capital position with CET1 ratio well above 20% CET1 ratio6 23.9% 23.0%
Source: Company information 1 Other assets include derivative assets, financial instruments, property and equipment and intangible assets among others; 2 Other liabilities include derivative liabilities and other liabilities; 18 3 Return on average equity; 4 NPL ratio: impaired loans / gross loans; 5 Total NPL coverage: (accumulated provisions + value of collateral) / impaired loans, The NPL coverage in Q1 2019 was lower because Afreximbank started using present value of collaterals; 6 CET1 ratio is defined as CET1 capital over total risk-weighted assets Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255
Strong financial performance driven by robust and growing balance sheet profile…
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Healthy asset growth… Lines 0, 170, 140 Total assets, US$mm 211, 230, 224 191, 191, 191 x7.9 15,029 13,419 11,726 11,913
155, 187, 89 7,134 227, 234, 216 5,189 3,731 4,358 1,905 2,868
128, 128, 128 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Mar-19 221, 221, 221 … supported by strong capital generation Shareholders’ equity, US$mm
191, 191, 191 235, 235, 235 CAR 24% 22% 21% 20% 21% 26% 23% 26% 25% 26%
x5.8 0, 115, 110 211, 219, 218 2,560 2,629 2,124 1,626 1,267 919 707 238, 236, 225 457 512 612 249, 249, 245
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Mar-19
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… with sound asset quality and liquidity…
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Diversified lending portfolio across countries and industries… … with low NPL ratio¹… Lines December 31, 2018 0, 170, 140 The funds borrowed by 211, 230, 224 191, 191, 191 Central Africa Other financial institutions are IFRS 9 5% 12% channelled to other East Africa economic sectors 10% Telecoms 1.4% 1.2% 1.0% 0.7% 0.7% 1.2% 7% 155, 187, 89 Southern Africa 4.1% 227, 234, 216 12% Services Financials 3.8% 7% 50% 2.8% 3.0% 2.4% 2.5%
128, 128, 128 North Africa West Africa Energy 221, 221, 221 25% 49% 24% 2014 2015 2016 2017 2017 2018 restated % Cost of risk over average net loans 191, 191, 191 … and strong NPL coverage² Afreximbank has ample liquidity to cover its liabilities (Dec-18) 235, 235, 235 IFRS 9 US$bn
4.9 141% 134% 137% 133% 132% 4.2 0, 115, 110 3.7 3.6 211, 219, 218 107% 2.5
1.4 1.3 238, 236, 225 1.0 1.0 249, 249, 245 0.4
2014 2015 2016 2017 2017 2018 restated up to 1 month 1-3 months 3-12 months 1-5 years over 5 years Financial Assets (US$m) Financial Liabilities (US$m)
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…and consistently delivering double digit profitability and payout ratio
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Strong revenue growth… … supported by industry leading Cost / Income ratio (2018) Lines 0, 170, 140 211, 230, 224 191, 191, 191 3.9% 3.3% 3.0% 2.9% 3.2% 53.3%
37.8% 38.3% 155, 187, 89 490 227, 234, 216 372 305 204 231 17.9% 88 41 48 56 67 128, 128, 128 221, 221, 221
2014 2015 2016 2017 2018 Pan-African LSE listed Bladex corporate banks emerging Operating income Operating expenses % Net interest margin² market banks 191, 191, 191 Solid track record of profitability… … and consistent distribution of dividends 235, 235, 235
13% 12% 11% 12% 12% 23% 23% 23% 26% 25%
276 69 0, 115, 110 211, 219, 218 220 58
165 38 125 29 105 24
238, 236, 225 249, 249, 245
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018
Net income (US$mm) % RoAE Dividend paid (US$mm) % Dividend payout ratio¹ Source: Company financials Note: Median value is used for the comparison vs. peers. Pan-African corporate banks include Absa, Nedbank, CIB, Banque Centrale Populaire, BMCE, Guaranty Trust Bank, Zenith Bank, Equity Bank, 21 Banque Marocaine, Credit Agricole Egypt, Ecobank Transnational, BIAT, United Bank for Africa, Standard Chartered Ghana. LSE listed emerging market banks include NLB, Halyk Bank, Bank of Georgia, TBC, Atlas Mara. Listed MDBs include Bladex ¹ Dividends distributed from net income / net income; ² Calculated as net interest income over average interest-bearing assets Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255 Case study: Afreximbank’s intervention and performance through the recent economic downturn
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Real GDP growth in Africa How did Afreximbank do this?
Lines 0, 170, 140 3.9% 211, 230, 224 191, 191, 191 3.6% 3.4% Due to the 2015 crisis, a new program: the Counter- 2.9% 2.8% Cyclical Trade Liquidity Facility (“COTRALF”) was set up Reactivity COTRALF was a 2-year emergency facility provided to member countries and aimed at supporting their liquidity 2014 2015 2016 2017 2018 155, 187, 89 227, 234, 216 African macro and commodity crisis Afreximbank engineered emergency facility under the following objectives: Achieving strong & resilient growth despite macro headwinds Respond to situations demanding significant trade 128, 128, 128 Innovation 221, 221, 221 Total assets (US$mm) support from countries CAGR: 50% Help Central Banks bridge trade finance funding gaps 11,726 11,913 13,419 related to international trade payments 5,189 7,134 191, 191, 191 Self-liquidating nature of the financed facilities, high- 235, 235, 235 2014 2015 2016 2017 2018 quality collateral backing and the use of central banks as Net income (US$mm) implementation partners helped mitigate the following risks: CAGR: 25% Risks 220 276 managed Country risk 0, 115, 110 105 125 165 No NPL 211, 219, 218 Credit and performance risk increase post 2014 2015 2016 2017 2018 Forex risk COTRALF Assets assailment risk NPL ratio¹ 4.1% IFRS 9 (1.4p.p.) restated NPL ratio 238, 236, 225 249, 249, 245 3.8% 2.8% 2.4% 2.5% 3.0% Total utilisation reached US$9.5bn, which have been fully repaid
2014 2015 2016 2017 2018 Outcome This success significantly increased the relevance of IFRS 9 Afreximbank, with 10 additional new member countries joining 22 Source: Company financials, African development Bank Statistics and International Monetary fund ¹ Impaired loans / Total gross loans Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Lines 0, 170, 140 211, 230, 224 191, 191, 191
155, 187, 89 227, 234, 216
128, 128, 128 221, 221, 221
191, 191, 191 4 235, 235, 235
0, 115, 110 211, 219, 218
238, 236, 225 249, 249, 245 Key takeaways Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Lines 0, 170, 140 211, 230, 224 191, 191, 191
155, 187, 89 227, 234, 216
128, 128, 128 221, 221, 221
191, 191, 191 5 235, 235, 235
0, 115, 110 211, 219, 218
238, 236, 225 249, 249, 245 Appendix Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255 Afreximbank is a pan-African trade finance institution covering 51 out of 55 countries in Africa
Highlights 255, 205, 0 255, 239, 211 255, 245, 204 Afreximbank snapshot Pan-African presence of Afreximbank
Leading trade finance institution in Africa Head office Lines 0, 170, 140 211, 230, 224 191, 191, 191 Member country with office Multilateral financial institution with preferred creditor status Member country
155, 187, 89 Broad pan-African presence 227, 234, 216 51 Participating / Efficient platform with well managed risk delivering Shareholders states double digit returns 128, 128, 128 221, 221, 221 Track record of double digit assets and profit growth Afreximbank aims to include all 55 African nations as participating states
Selected key financials Afreximbank’s key programmes % of 2018 7 191, 191, 191 US$mm 2016 2017 2018 Q1’19 CAGR¹ gross loans 235, 235, 235 Balance sheet . Provides credit lines to creditworthy Net loans 10,148 8,546 11,134 12,076 8.0% Line of African & non-African banks active in 47% Total assets 11,726 11,913 13,419 15,029 11.7% Credit African trade finance Shareholders' equity 1,626 2,124 2,560 2,629 23.8% 0, 115, 110 Income statement 211, 219, 218 Operating income 305 372 490 132 20.2% Net income 165 220 276 69 18.6% Direct . Provides pre and post export financing 23% Key ratios Financing directly to medium to large corporates Net interest margin² 3.0% 2.9% 3.2% 3.7% Cost / Income ratio3 18.4% 17.9% 17.9% 15.8% 238, 236, 225 249, 249, 245 Cost of risk4 1.0% 0.7% 1.2% 1.5% 5 RoAE 11.4% 11.8% 11.8% 10.6% . Arranges or joins a syndicate of banks to 8 6 16% NPL ratio 2.38% 2.50% 2.95% 2.74% Syndications provide syndicated loans to African 9 CET1 ratio 22% 26% 24% 23% entities CAR10 23% 26% 25% 26%
Source: Company information 25 1 CAGR over 2016 – Q1’19 period (CAGR for income statement numbers based on annualised Q1’19 numbers); 2 Calculated as net interest income over average interest-bearing assets; 3 Calculated as operating expenses over operating income; 4 Calculated as loan loss provisions over average net loans; 5 Calculated as net income over average equity; 6 As reported as of December 31, 2017, restated December 31, 2017 NPL ratio – 4.08%; 7 Remaining 12% of gross loans consists of other types of loan products; 8 Impaired loans / Total gross loans; 9 CET1 ratio is defined as CET1 capital over total risk-weighted assets; 10 Capital adequacy ratio Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255
Afreximbank’s key milestones and evolution
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Lines 0, 170, 140 African Afreximbank’s First branch Second Formed an Strategic Plan Fifth Strategic Launch of the 211, 230, 224 191, 191, 191 Development operations opened in branch alliance of mid-term Plan launched African Bank study to officially Harare opened in African IFIs review Continental create launched Abuja (“AAIFI”) CENDEP was Free Trade Afreximbank Headquarters Implemented a launched Area (AfCFTA) 155, 187, 89 Agreement Trade Finance Implementation 227, 234, 216 signed in Cairo Programme of the first with AfDB Intra-Africa Trade Fair
128, 128, 128 221, 221, 221
1987 1993 1994 1995 1996 2000 2003 2007 2009 2011 2014 2015 2016 2017 2018 191, 191, 191 235, 235, 235
First consultative Establishing Second Third Strategic Fourth Third branch Fifth Strategic 0, 115, 110 meeting with Agreement Strategic Plan Plan launched Strategic Plan opened in Plan full year 211, 219, 218 prospective registered with launched launched Abidjan review shareholders the UN as an Entered into Counter Establishment international collaboration Cyclical Agreement treaty with International Programme 238, 236, 225 signed resulting First Strategic Cocoa launched 249, 249, 245 in the formation Plan launched Organisation of Afreximbank (“ICCO”)
Source: Company information 26 Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255
Income statement and balance sheet summary
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Lines 0, 170, 140 211, 230, 224 191, 191, 191 Balance sheet, US$mm Dec-17 Dec-18 Mar-19 CAGR
Net loans 8,546 11,134 12,076 18.9%
155, 187, 89 Total assets 11,913 13,419 15,029 12.3% 227, 234, 216
Total liabilities 9,789 10,860 12,399 12.5%
128, 128, 128 Shareholders’ equity 2,124 2,560 2,629 11.3% 221, 221, 221
191, 191, 191 Income statement, US$mm FY-2017 FY-2018 2017-2018 Q1-2018 Q1-2019 Q1’18-Q1’19 235, 235, 235 growth growth
Gross income 648.8 805.5 24.2% 151.2 240.7 59.2%
0, 115, 110 211, 219, 218
Operating income 372.1 489.8 31.6% 79.5 132.4 66.5%
238, 236, 225 Net income 220.5 275.9 25.1% 53.9 68.8 27.6% 249, 249, 245
Source: Company information 27 Table colors Color palette Soft colors
Headings 0, 115, 110 211, 219, 218 255, 255, 255
Key financial ratios
Highlights 255, 205, 0 255, 239, 211 255, 245, 204
Lines 0, 170, 140 211, 230, 224 191, 191, 191 2016 2017 2018 Q1-2019
Return on average assets 1.75% 1.87% 2.18% 1.93%
155, 187, 89 Return on average equity 11.4% 11.8% 11.8% 10.6% 227, 234, 216
Net interest margin 2.98% 2.91% 3.23% 3.66%
128, 128, 128 Cash / Total assets 11% 27% 14% 18% 221, 221, 221
CET1 ratio 23% 26% 25% 23%
191, 191, 191 Cost / Income ratio 18% 18% 18% 16% 235, 235, 235
Equity / Total assets 14% 18% 19% 17%
Equity / Total assets (net of cash) 16% 24% 22% 21% 0, 115, 110 211, 219, 218
Equity / Net loans 16% 25% 23% 22%
Equity / Total assets (net of cash collateral) 23% 22% 24% 22% 238, 236, 225 249, 249, 245
Equity / Gross loans (net of cash collateral) 29% 33% 29% 29%
Source: Company information 28