FITCH Ratings has terminated its relationship with African Export-Import Bank (Afreximbank) and withdrawn all its ratings on the lender, citing commercial reasons, in a move that follows a recent fallout between both parties.

The rating agency said the decision was taken after its contract with the Cairo-based multilateral bank was ended. Afreximbank had earlier disclosed that it stopped engaging Fitch after disagreements over the bank’s risk profile.

At the same time, Fitch lowered its assessment of Afreximbank’s credit quality to sub-investment grade, cutting the bank’s long-term issuer default rating to BB+ from BBB-, and attaching a stable outlook.

According to Fitch, the downgrade reflected a major shift in how it views the bank’s role in sovereign debt restructurings. The agency reduced Afreximbank’s policy importance risk score to medium from low following Ghana’s decision to include the bank in its debt restructuring process.

The ratings firm said the Ghana agreement demonstrated that Afreximbank was not treated as a preferred creditor, weakening its assumed protection in crisis situations. This, it said, undermined the bank’s standing as a policy institution.

As a result of this change, Fitch also raised its assessment of Afreximbank’s business profile risk to high from medium, leading to a deterioration in its business environment score to minus three, from minus two previously.

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In December, Ghana and Afreximbank reached a preliminary deal to restructure a $750 million sovereign loan. The International Monetary Fund (IMF) later confirmed that the arrangement met the ‘comparability of treatment’ requirement set by Ghana’s official creditor committee.

Fitch said the transaction was proof that Afreximbank no longer enjoyed the protection typically granted to multilateral lenders, a status the bank had long claimed to hold.

“We view this as evidence that Afrexim did not benefit from its preferred creditor status,” the agency said, adding that its participation in Ghana’s restructuring pointed to declining policy relevance.

Fitch further noted that the lender’s elevated business risk had spillover effects on its governance and strategy scores, whicre also rated as high risk.

The agency highlighted Afreximbank’s heavy exposure to low-income countries, weak sovereign borrowers and politically fragile markets as structural constraints limiting its operating environment.

The decision has intensified debate over the role of regional development banks in Africa’s sovereign debt resolutions, as governments, creditors and multilateral institutions remain divided over whether such lenders should be exempt from losses.

While Afreximbank insists it is a preferred creditor, both Ghana and Zambia have challenged that claim, demanding that the bank accept debt relief terms comparable to those offered to official bilateral lenders.

Afreximbank threw the first punch

Last week, African Export-Import Bank (Afreximbank) announced that it had discontinued its credit rating relationship with Fitch Ratings, following an internal assessment of the engagement. The bank said the move was based on its view that Fitch’s rating process did not sufficiently capture Afreximbank’s legal foundation, institutional mandate, and operational model.

According to Afreximbank, its overall business position remained strong and stable, supported by long-standing shareholder relationships and the legal safeguards contained in its Establishment Agreement, which had been ratified by its member countries.

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Afreximbank operates as a Pan-African multilateral financial institution with a core mandate to facilitate and expand both intra-African and extra-African trade. Over the past three decades, the bank has developed innovative financing mechanisms aimed at transforming Africa’s trade structure, promoting industrialisation, and increasing regional economic integration.

As a key supporter of the African Continental Free Trade Agreement (AfCFTA), Afreximbank introduced the Pan-African Payment and Settlement System (PAPSS), which has been adopted by the African Union as the official payment platform for implementing the trade agreement.

Despite ending its relationship with Fitch, Afreximbank said it continued to maintain investment-grade ratings from other agencies, including GCR (A), Moody’s (Baa2), Japan Credit Rating Agency (A-), and China Chengxin International Credit Rating (AAA).