The African Export-Import Bank (Afreximbank) terminated its relationship with Fitch, saying the agency’s credit ratings did not reflect an understanding of the lender’s mandate.
The move, which comes months after the ratings agency downgraded Afreximbank to one notch above junk status, underscores tensions in the debate over Western institutions’ influence over perceived risks in Africa that can lead to steep capital costs.
Fitch’s downgrade focused heightened scrutiny on Afreximbank, which stands accused of “weak risk management policies” and “high solvency risks.” Moody’s downgraded Afreximbank a month after Fitch. The downgrades sparked a row in which some analysts argued that the “Big Three” ratings agencies — which are all New York-headquartered and also include Standard & Poor’s — do not accurately reflect the continent’s economic realities.
Afreximbank, announcing the severing of ties with Fitch on Friday, said its business profile “remains robust.” It marks the lender’s biggest shift since George Elombi was appointed as its president last year.