The African Export-Import Bank (Afreximbank), has disbursed $200 million to Zenith Bank Plc Nigeria, in a bid to support critical imports under emergency conditions, and maintain foreign currency trade flows impacted by the COVID-19 pandemic.
This disclosure was made on Friday, in a press release by the multilateral financial institution.
The disbursement, made under its Pandemic Trade Impact Mitigation Facility (PATIMFA), is in line with the Pan-African Bank’s mandate of financing, and promoting intra-and extra-African trade.
PATIMFA is a 3-year medium-term facility, set up in March 2020 to support and stabilize the foreign exchange resources of Afreximbank member countries, to enable them support critical imports under emergency conditions.
The financing from this facility is accessed via direct funding, to assist Afreximbank member countries to adjust in an orderly manner to the financial, economic, and health services shocks caused by the COVID-19 pandemic.
The President of Afreximbank, Prof. Benedict Oramah, remarked that the bank is pleased to keep supporting Nigeria’s largest bank by tier-1 capital, with recovery from the effects of COVID-19.
“The role banks such as Zenith Bank play in Africa is huge, and supporting them to carry out their mandate is the group’s greatest contribution to making sure that African countries and institutions build back better from the shocks of the pandemic,” he said.
Zenith Bank’s Group Managing Director, Mr Ebenezer Onyeagwu, said that this gesture, “undoubtedly underscores the confidence reposed in Zenith Bank.”
He reiterated that the facility will enable the bank to contribute to the fight against the COVID-19 pandemic by providing trade finance and foreign currency funding for the importation of urgent medical equipment, and raw materials.
The African Export-Import Bank was established in October 1993, with its headquarters in Cairo, Egypt. It is owned by African governments, the African Development Bank, and other African multilateral financial institutions, as well as African and non-African public and private investors.
The bank has disbursed more than US$31billion between 2016 and 2019.
Previous Facility created to support member countries
Afreximbank, has a history of providing support to African economies in times of economic crisis. During the 2015 economic crisis, it introduced a Counter-Cyclical Trade Liquidity Facility, under which it disbursed more than $10 billion on a revolving basis, to enable member countries to adjust to the adverse economic shocks.
The financial strength of Afreximbank
At the end of 2019, the Bank’s total assets and guarantees stood at $15.5 billion, and its shareholders’ funds amounted to $2.8 billion.
Afreximbank has disbursed more than $3.5 billion under PATIMFA. In addition, the Bank provided a grant of $3 million towards the COVID-19 Special Fund – set up by the African Union, as well as to the African Center for Disease Control and other agencies.