NAIROBI, 2 June 2015 –The African Trade Insurance Agency (ATI) released its 2014 results showing a record profit for the third consecutive year. ATI posted a $3.4 million profit (Ksh 327 million), which represents a 130% increase over 2013. The pan-African insurer also joined the $1 billion club recording $1.3 billion (Ksh 125 billion) in exposure in 2014.
The company attributes its strong growth to infrastructure driven demand in the region, where it is insuring a record number of contractors and suppliers as well as a growing appetite from banks to support the SME sector.
Nearly 80% of ATI’s current business involves banks covering direct loans and their entire portfolio of clients. For banks, ATI issues counter guarantees on bonds and insures trade finance products.
“With this added support, banks have been able to increase their lending volumes, particularly within the SME sector. In Kenya alone, ATI’s exposure – or insured trade and investments – doubled over 2013 to $600 million (Ksh 58 billion),” commented ATI’s Chief Executive Officer, George Otieno.
ATI recorded another notable achievement in 2014 which contributed to the company’s positive results. For the first time in its history, ATI was profitable purely on its underwriting business, where it posted a $1.2 million (Ksh 115 million) profit. This reflects the company’s long-term strategy, which has seen its portfolio transform to include more stable and renewable commercial risk business involving transactions that cover companies against various payment default scenarios.
“Over time we have built a business that is more stable and predictable with a competent staff of expert underwriters. Now at least 80% of our business is renewable business, which means that every year we are starting with a solid base of income,” added Jef Vincent, ATI’s Chief Underwriting Officer.
The company’s Chief Financial Officer, Toavina Ramamonjiarisoa noted that “our extremely strong capital adequacy and liquidity are part of the key ingredients supporting our A/Stable rating and making us an attractive company for prospective shareholders like ECOWAS.”
ATI plans to expand into West Africa through a partnership led by the ECOWAS bloc that is expected to see most of their member countries join ATI in the next few years.
In 2014, Kenya Re became ATI’s newest shareholder.
ATI unveiled its results just ahead of its 15th Annual General Meeting of Shareholders to be held on the 5th of June. His Excellency Hon. Uhuru Kenyatta, President of the Republic of Kenya is expected to open the event.
