Afreximbank’s decision to end its credit rating relationship with Fitch marks a significant moment in the ongoing debate over how African multilaterals are assessed by global credit rating agencies.
The Bank has argued that Fitch’s methodology no longer aligns with the legal, structural, and strategic realities embedded in its establishment agreement, which has been signed and ratified by its member states.
In a statement, the Bank said: “This decision follows a review of the relationship, and its firm belief that the credit rating exercise no longer reflects a good understanding of the Bank’s Establishment Agreement, its mission and its mandate.”
Move follows June downgrade
The move comes against the backdrop of Fitch’s June 2025 downgrade of the Bank, which lowered Afreximbank’s Long-Term Issuer Default Rating to BBB- and assigned a negative outlook. Fitch justified the downgrade at the time by citing “the rise in the Bank’s non-performing loans (NPLs) ratio as calculated by Fitch, which exceeded the 6% ‘high risk’ threshold” and concerns over “weak risk management policies.”
Afreximbank strongly rejected these conclusions, insisting that Fitch’s interpretation failed to reflect the Bank’s treaty-based protections and its IFRS‑compliant approach to loan classification. In its formal response, the Bank stated that Fitch’s methodology was “analytically and legally flawed” and that its sovereign exposures were governed by a treaty framework that ensures repayment obligations by member states.
According to the bank, “Fitch’s definition of NPLs differs from the Bank’s approach, which makes use of forward-looking information.”
The Bank’s latest decision reinforces this position. As Afreximbank noted in its earlier statement, “the treatment of its loans and other activities is governed by the treaty and not by classifications created outside its framework.”
This broader critique of global rating practices is echoed across the continent. Speaking on a panel during the Intra African Trade Fair (IATF) in Algiers in September on the heels of his election as president of Afreximbank, George Elombi insisted that the methodology and premise adopted by Fitch is erroneous and does not take into account the treaty setting up African multilateral finance institutions and their Africa-first mandates.
“Why should Fitch be worried that African governments want to protect their own institutions? We have become very relevant and important to our governments,” he said.
Push for rating sovereignty
By severing ties with Fitch, Afreximbank is signalling a broader push for rating sovereignty – one that aligns with Africa’s efforts to establish its own credit rating agency and reduce reliance on the traditional “Big Three”.
The Bank maintains that its ”business profile remains robust, underpinned by strong shareholder relationships and the legal protections embedded in its Establishment Agreement, signed and ratified by its member states.”
The development may accelerate Africa’s long‑running campaign for fairer, context‑sensitive credit assessments – an issue that will remain central as the continent deepens its financial integration and expands its multilateral lending architecture.
There has been mounting criticism of the metholodogies that international credit ratings agencies use to rate African countries and financial institutions.
Writing in a piece in African Business in August 2025, Mushtak Parker reported that credit rating agencies are operating from a skewed rating system.
“Are low-and-medium-income-countries experiencing an existential sovereign risk rating crisis beyond the usual country and credit risk parameters? They, including many African countries which are disproportionately affected, consistently stress the high cost of financing, credit, investment insurance and punitive surcharges involved in borrowing, which deter market entry and the ability to crowd in much-needed private capital.”