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By Uche Usim
The African Export-Import Bank (Afreximbank) has officially cut ties with Fitch Ratings, a move that ends a long-running dispute over how the global rating firm judges the bank’s financial strength.
Fitch Ratings is one of the world’s top credit rating agencies that judge how financially reliable countries, banks and companies are. In simple terms, Fitch tells investors how risky it is to lend money to a government or business entity.
In a statement released on Friday, Afreximbank said it no longer believes Fitch’s rating approach reflects the bank’s legal foundation, mission or mandate.
According to the Pan-African lender, the rating model being applied does not properly account for the bank’s treaty-based protections or its unique role in financing African trade and development.
“This decision follows a review of the relationship, and our firm belief that the credit rating exercise no longer reflects a good understanding of the Bank’s Establishment Agreement, its mission and its mandate,” Afreximbank said.
Fitch had not responded publicly at the time of publication, but the fallout, analysts note, marks a major escalation in a disagreement that has been building for months.
The clash stems from Fitch’s June 2025 decision to downgrade Afreximbank’s long-term credit rating from BBB to BBB-, with a negative outlook. The agency cited concerns about the bank’s exposure to loans made to African governments, especially countries facing debt challenges.
Fitch highlighted sovereign exposures to countries such as Ghana, South Sudan, and Zambia, some of which were undergoing or at risk of debt restructuring. It also raised red flags about asset quality, transparency, and how the bank applies IFRS 9 accounting standards.
A key area of disagreement was how to classify non-performing loans (NPLs). Fitch estimated Afreximbank’s NPL ratio at 7.1%, while the bank reported a significantly lower 2.3%. Fitch also argued that the bank’s involvement in sovereign debt restructurings could weaken its “preferred creditor” status, a crucial safeguard for multilateral lenders.
Afreximbank pushed back strongly. It denied taking part in sovereign restructurings, insisting its treaty grants it legal protections that rating models should respect. The bank also defended its financial reporting, saying its loan classifications comply with IFRS 9 and are backed by independent external audits.
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Beyond technical arguments, the downgrade had real-world financial impact. Sources familiar with the matter said Fitch’s rating decision raised Afreximbank’s borrowing costs in international markets. Higher perceived risk translated into higher interest rates and made it harder for the bank to secure affordable funding.
For a lender whose mission is to support African trade, exports, and industrialisation, higher funding costs can ripple across the continent, potentially making loans more expensive for businesses and governments alike.
Afreximbank argues that the rating downgrade misrepresents its risk profile and unfairly penalises an institution designed to operate under different rules than commercial banks.
The dispute highlights a wider frustration among African financial institutions with global credit rating agencies. Many policymakers and bankers believe international rating firms apply “one-size-fits-all” models that fail to capture Africa’s economic structures, policy reforms, and development realities.
In June 2025, Afreximbank’s Group Chief Economist, Yemi Kale, warned that flawed and externally biased rating frameworks were driving up borrowing costs for African countries, even as macroeconomic conditions improved in several markets.
He argued that Africa continues to be judged through models built for advanced economies, rather than systems tailored to the continent’s risks and opportunities.
This growing dissatisfaction has helped fuel the creation of the African Credit Rating Agency (AfCRA), backed by the African Union. The new agency plans to begin issuing ratings by late 2025 or early 2026, offering a homegrown alternative to Fitch, Moody’s, and S&P.
Afreximbank’s decision is unusual in global finance. It is rare for an issuer to publicly terminate a relationship with a major rating agency immediately after a downgrade — and to do so so openly.
Typically, rating coverage changes are initiated by the agencies themselves or handled quietly as part of routine financial housekeeping. By making its decision public, Afreximbank has turned a technical ratings dispute into a broader statement about fairness, sovereignty, and Africa’s financial narrative.
The move, experts note, signals a growing willingness among African institutions to challenge global gatekeepers and to push for credit assessments that better reflect the continent’s realities and ambitions.
