• Afreximbank crossed the $1 billion net profit threshold in 2025 for the first time, a milestone driven by balance-sheet expansion and a maturing trade finance franchise

• Operating costs grew 25% — more than twice the pace of revenue — signaling that the bank's strategic transformation carries a cost discipline test ahead

• With its sixth strategic plan concluding in 2026, management has a clear window to demonstrate that its multi-platform ambition can deliver both growth and efficiency

African Export-Import Bank, the Cairo-headquartered multilateral trade finance institution with $48.5 billion in total assets and other off-blance sheets items, crossed the $1 billion net profit threshold for the first time in its 31-year history in 2025. This milestone reflects the steady growth of its lending activities, more diversified sources of income, and an expanding role across Africa and the Caribbean, according to audited financial statements published March 31.

Net income reached $1.157 billion, a 19% increase from $973.5 million in 2024. The bank’s loan portfolio grew 16% to $33.5 billion, while net interest income — the difference between what it earns on loans and pays on funding — rose 5.6% to $1.91 billion. Overall revenues increased 6% to $3.5 billion, and total assets climbed 20% to $42.3 billion, confirming Afreximbank’s position among Africa’s leading development finance institutions.

“In 2025, the Afreximbank Group continued to advance development across its member states in Global Africa, which encompasses Africa and the Caribbean countries (CARICOM), providing essential support during a year marked by heightened uncertainty. Global conditions remained challenging, characterised by geopolitical tensions, elevated inflation, currency volatility, and tighter financing conditions, all of which placed significant pressure on emerging and developing economies. Climate related shocks further complicated the operating environment, intensifying strains on food systems, infrastructure, and already-constrained fiscal space,” the institution said in its report.

The result matters beyond just the financial performance. Afreximbank’s mission is to finance trade while remaining financially strong. The 2025 results show that the bank is financially solid. However, the next years will test whether it can maintain this strength while managing the costs of its current expansion.

Strategic transition

The figures suggest the bank is intentionally evolving into a more complex group with several business lines. It is investing in two key subsidiaries: FEDA Holdings, a $1.3 billion investment platform supporting strategic sectors, and the African Medical Centre of Excellence, a major healthcare project in Abuja valued at $249 million. These projects did not generate significant revenue in 2025 but are long-term investments aligned with the bank’s industrial development strategy launched in 2022.

This transformation comes with higher costs in the short term. Operating expenses rose 25% to $459 million. Personnel costs increased 17% to $159 million, administrative expenses rose 25% to $261 million, and depreciation — reflecting investment in buildings and equipment — jumped 80% to $38 million. The cost-to-income ratio rose to 21% from 18% a year earlier. While still below the bank’s internal ceiling of 30% and competitive with peers, the upward trend will need close monitoring. Management attributes this increase to global inflation and deliberate investment in capacity under its strategic plan, which ends in December 2026 and could mark a turning point for cost control.

Earnings quality deserves a closer look. The $1.157 billion profit included $75 million recovered from loans previously considered lost (up from $19 million in 2024) and $52 million in gains from investment revaluations linked to FEDA. These gains may not occur every year. However, the core business remains solid: income from services such as advisory, letters of credit, and guarantees grew 40% to $276 million, showing real diversification beyond traditional lending income.

Asset quality remained strong despite a difficult environment. The share of non-performing loans (loans that are not being repaid) increased slightly to 2.43% from 2.33%, staying at a manageable level and well below the 5% threshold that typically raises concern. Total provisions set aside to cover potential loan losses reached $1.9 billion, while the most at-risk loans (Stage 3) increased 22% to $880 million. These trends reflect ongoing pressures such as currency volatility and economic constraints in member countries, but the bank continues to benefit from strong risk protections, including its preferred creditor status and structured collateral arrangements.

Shareholders’ equity rose 17% to $8.4 billion, supported by $300 million in new capital raised and part of the year’s profit being retained. The board proposed a dividend of $347 million plus a $50 million special payout, in line with a 30% payout ratio and a commitment to stable returns for investors.

The capital adequacy ratio stood at 23%, slightly lower than 2024 but still well above regulatory requirements, giving the bank room to continue expanding. On the funding side, short-term market borrowing (money-market liabilities) increased sharply by 62% to $4.55 billion. This shift in funding structure is something management will likely want to manage carefully over time.

With the sixth strategic plan entering its final year, the priorities for 2026 are clear: control costs, begin generating returns from recent investments, and define a new strategy that can turn this record profit into a sustainable long-term baseline.

Idriss Linge