African Trade Insurance (ATI) has announced a 6th consecutive year of profit to USD9.9 million in Net Profit for the year ending December 2017, as Gross Written Premiums and Equity reach USD44.8 million and USD242.2 million, respectively, on a steady business expansion.
Mr. George Otieno, African Trade Insurance’s Chief Executive Officer, said the repositioning of the Company to provide even more support to its member countries across Africa with a specific focus to help governments reduce their cost of borrowing and provides an alternative to raising foreign currency debt through bond markets or syndicated loans, had supported the company’s stronger performance.
“The continent is currently searching for African solutions to tackle development challenges such as affordable access to financing. As an African institution, ATI is poised to become a go-to option for African governments – we are pursuing a strategy to achieve this goal,” Mr. Otieno said.
ATI is expanding its presence in key markets to include office openings in the next year in Benin, which will operate as ATI’s West Africa hub, Côte d’Ivoire, and Ethiopia. Importantly, ATI is also planning to undertake a rebrand in order to better reflect its new positioning as a strategic investment insurance partner to Africa and the world.
ATI is partnering with governments to provide a one-stop risk mitigation solution to lenders. This allows governments to negotiate more competitive rates that can reduce their cost of financing by as much as 100 bps per annum for example, on loans of USD250 million – USD350 million.
In 2017, ATI also strengthened its governance as another step to readying itself for an expanded role across Africa.
By reconstituting its Board, which now ensures rotation, fair representation, and infusion of new talent, the company can better accommodate expected growth in membership. This process led to the appointment of a new Board and Chairman. The new Chairman, Dr. Yohannes Ayalew Birru, is a high ranking economist in the Government of Ethiopia, where he formerly held the position of Vice Governor and Chief Economist of the National Bank. He is also an Alternate Governor of the IMF.
The recent restoration by S&P Global Ratings of ATI’s ‘A/Stable’ (positive outlook) rating is proof that ATI’s strategy is gaining traction. In 2016, S&P placed ATI on a negative watch prompting the company to step up efforts to recover payments on sovereign claims while also putting in place structures to avoid future payment delays by governments. In 2017, ATI successfully negotiated repayments on member government’s outstanding sovereign claims.