Global Markets

African Trade Insurance gets A3 IFSR Rating by Moody

For the fifth year running, Moody’s Investors Service (“Moody’s”) has confirmed the African Trade Insurance Agency’s (ATI) A3 insurance financial strength rating (IFSR) and altered the outlook from stable to positive.

According to Moody’s, the improvement in portfolio diversity, stronger capital sufficiency, and the solid profitability despite the difficult operating environment are all due to ATI’s robust membership base expansion. Furthermore, ATI advantages from its standing as a preferred creditor (PCS) among the sovereign member states, which shields it from the danger of member sovereign default by getting reimbursements for claims made on guarantees.

One of the main reasons why Standard & Poor’s and Moody’s have consistently reinstated ATI’s A/Stable rating throughout the years is the strong membership and equity growth. The company’s consistent improvement in financial performance, the dedication of its shareholders in maintaining the preferred creditor status, its high-quality and conservative investment portfolio, and its solid connections with numerous international reinsurers that offer significant risk-bearing capacity all support the rating affirmation.

Since the outlook has changed to “positive,” ATI is now better equipped to help its member nations more effectively, draw more investors, and expand its holdings. The optimistic view suggests that, among other things, ATI may generate upward pressure for an upgrade if it continues to exhibit outstanding underwriting performance and the capacity to recover claims under preferred creditor arrangements. You can access the Moody’s press release here.

Africa Trade Insurance CEO Manuel Moses commented on the rating, saying: “This positive revision is in line with our 2023–2027 strategic objectives, which included improving our rating outlook to positive in the first year and achieving an upgrade of at least “AA”/Stable rating by both Moody’s and S&P during this Strategic Plan period. By expanding our exposures and raising our capital to more over $1 billion USD, we want to achieve this.

The goal of ATI is to give its member nations and associated public and commercial sector actors with trade-credit and political risk insurance, as well as other risk reduction solutions. These insurance products support intra- and extra-African trade while also directly promoting and facilitating both local and foreign direct investment in our member nations.

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