Fitch Ratings, the global credit rating agency, has affirmed the African Development Bank’s (AfDB) Long-Term Issuer Default Rating (IDR) at ‘AAA’ with stable outlook.
The AfDB Communications and External Relations Department made this known in a statement in Abuja on Tuesday.
The statement quoted the agency as saying “the ‘AAA’ rating of the AfDB is driven by extraordinary support it receives from its shareholders, which Fitch Ratings assesses at ‘AAA’.
It noted that the agency judged the Bank’s risk management policies as conservative and excellent in line with ‘AAA’ rated regional peers.
“The Bank’s liquidity profile at ‘AAA’, reflecting an ‘excellent’ liquidity buffer and quality of liquid assets while the bank’s capitalisation is judged strong reflecting strong equity-to-assets ratio”.
The bank noted that the rating agency assumed a 125 per cent in subscribed capital from 2021 as per the Bank’s 7th General Capital Increase plan approved in October 2019.
Commenting on the development, Dr Akinwumi Adesina, the President of the Bank expressed delight on the rating.
“We are delighted with the affirmation of the ‘AAA’ rating of the Bank with a stable outlook by Fitch Ratings, in spite the global and regional economic challenges from the COVID-19 pandemic.
“We will continue to strengthen our policy relevance to support regional member countries, especially during and after the period of COVID-19, while ensuring that we maintain our prudential ratios with adequate buffers.
“The Bank will continue to apply strong risk management. We are positive that African countries’ economies will recover as the pandemic subsides and Africa returns to a positive Gross Domestic Product growth trajectory” Adesina said.