Overview
The Africa Finance Corporation (AFC) is a multilateral financial institution established in 2007 to address Africa's infrastructure deficits and promote economic growth. Here are the key aspects of the AFC:
Establishment and Ownership
AFC was founded with an anchor investment from the Central Bank of Nigeria (CBN) and 17 private institutional investors. Today, it has 31 shareholders, including 10 sovereign states, 3 multilateral organizations, and 18 private institutional investors. The CBN remains the largest shareholder, holding approximately 41.89% of AFC's shares.
Mission and Business Model
AFC's mission is to foster economic growth and industrial development in African countries while delivering competitive returns to shareholders. It operates through a unique value proposition, offering services in project development, financial advisory, and principal investing. AFC participates across the entire project cycle and capital structure, ensuring well-structured projects and successful financial closures.
Investment and Funding
Since its inception, AFC has mobilized up to $5.1 billion from global debt markets and deployed over $12.7 billion in investments across 36 African countries. The corporation employs a diverse funding strategy, including tapping into niche markets, diversifying funding sources, and leveraging market opportunities. AFC has issued various financial instruments such as Eurobonds, green bonds, and syndicated loans to enhance its investment capacity.
Focus Areas and Projects
AFC focuses on financing infrastructure, natural resources, and industrial assets to enhance productivity and economic growth in African states. Its projects span several sectors, including:
- Power
- Agriculture
- Regional integration
- Rural value chains
- Manufacturing
- Trade-related infrastructure The corporation also invests in climate change adaptation and mitigation projects, such as renewable energy generation and sustainable transport.
Strategic Partnerships and Accreditations
AFC has established strategic partnerships with other regional financial institutions and has been accredited by the Green Climate Fund (GCF) since 2015. This accreditation enables AFC to implement projects that address Africa's infrastructural gaps while promoting low-emission and climate-resilient development pathways.
Development Outcomes
AFC's investments aim to address the critical infrastructure gap in Africa, promote industries, create jobs, add value, and stimulate overall economic growth. The corporation also supports intra-African trade and regional integration, facilitating the importation of critical capital goods, agricultural inputs, medical supplies, and foodstuffs. In summary, the Africa Finance Corporation plays a pivotal role in addressing Africa's infrastructure challenges through a comprehensive approach that includes project development, financial advisory, and principal investing, while fostering economic growth and industrial development across the continent.
Leadership Team
The Africa Finance Corporation (AFC) boasts a robust and experienced leadership team that drives its mission to catalyze private sector-led infrastructure investment across Africa. The team comprises a diverse group of professionals with extensive experience in finance, infrastructure development, and African markets.
Board of Directors
The AFC's Board of Directors includes:
- Emeka Emuwa (Chairman): Over three decades of experience in leading banking institutions
- Roosevelt Ogbonna, FCA: Managing Director/CEO of Access Bank PLC
- Anastasia Soula Proxenos: Independent Director with over 30 years of financial services experience
- Henry Paul Batchi Baldeh: Investment banker and infrastructure specialist with 33+ years of experience
- Bolaji Jubril Lawal: Managing Director/CEO of Ecobank Nigeria Limited
- Ini Ebong: Deputy Managing Director of First Bank of Nigeria Limited
- Anthony A. Ogunranti: Executive Director at Zenith Bank Plc
- Olumuyiwa Akinyemi: Deputy Managing Director of United Bank for Africa (UBA)
- Kabelo Rikhotso: Chief Investment Officer and Executive Director of the Public Investment Corporation (PIC)
- Sherine El Sharkawy: First Deputy Minister of Finance for Economic Affairs
- Ali Güney: Chief Executive Officer of Türk Eximbank
- Ingrid van Wees: Independent Non-Executive Director, finance and risk management professional
- Beatrice Hamza Bassey: Independent Non-Executive Director, accomplished legal professional
- Yetunde Oni: Managing Director/CEO of Union Bank of Nigeria
Management Team
Key members of the AFC's management team include:
- Samaila Zubairu (President & CEO): Over three decades of leadership experience, champion for African value capture and industrialization
- Banji Fehintola (Executive Director and Head of Financial Services): Oversees Treasury & Financial Institutions, Financial Advisory, Syndications, and Capital Mobilization & Partnerships
- Sameh Shenouda (Executive Director and Chief Investment Officer): 27+ years of experience in infrastructure investments and project development
- Ayotunde Anjorin (Senior Director & Chief Financial Officer)
- Ayaan Adam (Senior Director and CEO of AFC Capital Partners): 27 years of experience in emerging markets investment and climate change-related financing
- David Johnson (Senior Director & Chief Risk Officer): Led comprehensive reviews of major risk management policies
- Patricia Aderibigbe (Human Resources Director): Over 25 years of experience in talent management and organization development
- Dr. Rita Babihuga-Nsanze (Director & Chief Economist and Head of Research and Strategy)
- Vivienne Yeda (General Counsel and Corporate Secretary): Experience in strategic management, banking, and international law This diverse and experienced leadership team collectively contributes to AFC's strategic vision, focusing on accelerating development impact, fostering industrialization, and enhancing value capture and retention across Africa through critical infrastructure investments.
History
The Africa Finance Corporation (AFC) has a rich history since its establishment in 2007, marked by significant growth and impact on African infrastructure development.
Founding and Establishment
- Founded in December 2007 by an agreement among sovereign African states
- Key founders: Austine Ometoruwa (then Head of Citibank Africa Investment Bank) and Chukwuma Soludo (then Governor of the Central Bank of Nigeria)
- Established with an authorized share capital of US$2 billion
- Initially structured as a joint venture between public and private investors:
- Private investors: 62% ownership
- Central Bank of Nigeria: 38% ownership
Early Projects and Investments
AFC's early years saw investments in various sectors, including:
- Oil and gas
- Telecommunications
- Transport
- Airline projects Notable early projects:
- June 2009: Equity financing for the US$240 million Main One Cable System (7,000 km submarine fiber-optic cable)
- September 2011: US$320 million trade finance facility in partnership with Afreximbank and BIAO-CI for crude oil processing in Côte d'Ivoire
Expansion and Partnerships
- July 2011: Signed first loan, a US$50 million bilateral deal with Standard Bank
- 2012: African Development Bank approved a US$200 million line of credit to AFC
- June 2016: Merged power sector assets with Harith General Partners
Corporate Governance and Membership
- Operates under the Agreement for the Establishment of Africa Finance Corporation and the AFC Charter
- Enjoys supranational status, subject to international law and conventions
- As of December 2022: 40 member states, including multilateral organizations
Recent Developments and Investments
- 2019: African Development Bank Group invested US$50 million, becoming a shareholder
- Successful Eurobond issuances:
- 2019: US$650 million
- 2017: US$500 million
- 2015: US$750 million
- By 2022:
- Invested over US$12.7 billion in projects across 36 African countries
- Total asset base: approximately US$12.34 billion
- Total equity: US$3.42 billion
Current Operations and Impact
AFC focuses on five key sectors:
- Power
- Natural Resources
- Transport and Logistics
- Telecommunications
- Heavy Industries The corporation provides a range of financial products and services, including:
- Debt, equity, and mezzanine instruments
- Financial advisory
- Project development
- Technical advisory services AFC has established strong partnerships with governments and developed a robust infrastructure-focused sovereign lending business. It continues to play a crucial role in addressing Africa's infrastructure deficit and driving sustainable economic growth across the continent.
Products & Solutions
The Africa Finance Corporation (AFC) offers a comprehensive range of products and solutions designed to address Africa's infrastructure gaps and foster economic growth. Here are the key areas of their offerings:
Project Development
AFC is involved in the development of infrastructure, natural resources, and industrial assets from initial stages through to financial close. They provide project management expertise to ensure projects are well-structured and meet the objectives of all parties involved.
Financial Advisory
The corporation offers financial advisory services, including structuring and lending solutions, to sovereign, sub-sovereign, corporate finance, and trade finance clients. This encompasses advice on debt and equity financing, as well as risk mitigation strategies.
Principal Investing
AFC engages in principal investing across various sectors such as power, transport and logistics, natural resources, telecommunications, and heavy industries. They offer a range of financial products including greenfield equity, buy-out capital, acquisition financing, royalty and streaming, structured debt, and mezzanine financing.
Debt and Equity Financing
AFC provides diverse debt and equity financing solutions, including:
- Sovereign Lending: Direct lending to government and quasi-government entities for key infrastructure projects.
- Corporate Finance: Structured finance and trade finance solutions for corporate clients.
- Bridge and Long-term Financing: Options up to 15 years in USD and Euro.
Trade Finance
AFC facilitates inter and intra-Africa trade through funding lines for import and export, issuance of bonds, and guarantees against major infrastructure projects.
Treasury Solutions
The corporation offers treasury services including fixed income, money markets, liquidity solutions, convertible loan notes, and hedging strategies to help clients manage financial risks and optimize their positions.
Risk Mitigation and Structuring
Utilizing its high credit rating (A3 from Moody's) and Preferred Creditor Status, AFC provides risk mitigation solutions, tenor elongation, loan repacks, and asset transformation strategies to enhance project bankability and improve debt sustainability.
Guarantees and Syndications
AFC offers guarantees and participates in syndicated loans to attract new investors to infrastructure transactions. This includes their A/B Bond insurance enhanced off-balance sheet program.
Sector Focus
AFC specializes in key sectors with high developmental impact and returns, including:
- Power and Renewables
- Transport and Logistics
- Natural Resources
- Telecommunications and Technology
- Heavy Industries
- Agro-processing and Healthcare Through these comprehensive solutions, AFC aims to bridge Africa's infrastructure gap, foster economic growth, and deliver competitive returns to its shareholders.
Core Technology
While the Africa Finance Corporation (AFC) is not primarily focused on developing or investing in core technological innovations, it leverages technology to enhance its infrastructure and financial services. Here are the key aspects of AFC's approach:
Infrastructure Focus
AFC specializes in providing financing solutions for infrastructure projects across various sectors, including Power & Renewables, Transport & Logistics, Telecommunications & Technology, Heavy Industry, and Natural Resources.
Financial and Technical Advisory
The corporation combines specialist industry expertise with financial and technical advisory services, project structuring, and project development to address Africa's infrastructure needs.
Investment Strategy
AFC invests directly in single assets, through platforms, and via its independent asset management arm, AFC Capital Partners. It offers a range of financial products including project development, equity, senior, mezzanine, subordinated and sovereign debt, trade finance, guarantees, and syndications.
Sustainability and Climate Change
AFC emphasizes sustainable investing, climate finance, and robust environmental and social governance (ESG) policies. This includes mainstreaming climate finance thinking and conducting research to drive thought leadership in these areas.
Digital Initiatives
While not the primary focus, AFC engages in digital initiatives to support infrastructure development. For example, it has partnered with Itana to create Africa's first digital economic zone, which includes an eco-friendly tech campus and funding for startups through an accelerator program. In summary, AFC's core technology involvement is centered on leveraging technology as a tool to enhance its infrastructure and financial services, rather than developing or investing in technological innovations as its main mandate.
Industry Peers
The Africa Finance Corporation (AFC) operates within the financial and infrastructure development sector, with several notable institutions serving as its industry peers and competitors:
African Export Import Bank (Afreximbank)
Afreximbank is an international financial institution that promotes and finances trade within Africa and between Africa and other continents.
African Development Bank Group (AFDB)
The AFDB is a commercial bank and economic development agency that includes the African Development Bank, the African Development Fund, and the Nigeria Trust Fund. It focuses on economic development across Africa.
African Infrastructure Investment Managers (AIIM)
AIIM is an infrastructure investment firm aiming to be the most creative and trusted in Africa, focusing on various infrastructure sectors.
International Finance Corporation (IFC)
As a member of the World Bank Group, IFC is a global development institution focused exclusively on the private sector in developing countries, specializing in direct and fund investments.
Other Competitors
Additional competitors and peers include:
- Chapel Hill Denham, a financial services firm
- Other development finance institutions and banks operating in the African region, such as the Asian Development Bank and the Inter-American Development Bank, although they are not exclusively focused on Africa AFC differentiates itself through its diversified service offerings, including:
- Project development
- Financial advisory services
- A range of financial products such as equity, quasi-equity, mezzanine and subordinated debt, and senior debt This comprehensive approach allows AFC to address Africa's infrastructure needs while delivering value to its stakeholders and contributing to the continent's economic growth.