Kenya remains single largest shareholder at ATI, following the entry of four new investors
Kenya's shareholding in African Trade Insurance Agency has been marginally diluted following entry of four new investors, the largely political risk and investment guarantee firm has said.
Chief executive George Otieno said Kenya's stake has dropped to about 12 per cent from 15 per cent. This was after Ethiopia and Zimbabwe joined the pan-African investment and commercial risk insurance provider last year, while Ivory Coast came on board last month.
UK’s national export credit agency, UK Export Finance, has also acquired undisclosed stake in ATI, joining African Development Bank and Italian Export Credit Agency as non-state shareholders.
“Kenya, however, remains the single largest shareholder in ATI and by some measure the single biggest beneficiary of ATI cover since its inception,” ATI’s chief underwriting officer John Lentaigne said. “We have investments in Kenya equivalent to 15 per cent (about Sh1.08 trillion) of the current GDP (about Sh7.2 trillion) since its (ATI's) inception.”
The company was formed by seven African countries, with Kenya as single largest shareholder, in 2001 but started operating fully in 2003. The agency was financially and technically supported by the World Bank Group during its formation.
Kenya's stake is expected to drop further to about 10 per cent in the near-term, Otieno said, with more countries lining up for a stake in the insurer.
ATI has opened talks with South Sudan, Ghana, Nigeria, Angola, Cameroon, Sudan, Djibouti and Sierra Leone.
“Some of the talks are at an advanced stage. For example, we expect to complete negotiations with South Sudan by end of the year,” Otieno said. Minimum capital in the 13 state-shareholder insurer is $7.5 million (about Sh773.55 million).
Other member-state shareholders are Tanzania, Uganda, Rwanda, DRC, Burundi, Malawi, Zambia, Madagascar and Benin.
The Nairobi-based company has attributed the 36.17 per cent growth in net earnings to “stronger partnerships with African governments”, the chief financial officer Toavina Ramamonjiarisoa said.
ATI's net profit for 12 months through December 2016 increased to $6.4 million (about Sh660.10 million) from $4.7 million (about Sh484.76 million) in 2015, marking the sixth consecutive year of profit following a loss in 2011.
“We are increasingly viewed as a strategic partner in Africa, helping investors and our member countries attract vital foreign investments,” Otieno said. “Our impact is being felt and this is reflected in statistics that indicate we are insuring investments equivalent to approximately one per cent of our member country’s GDP every year.”
ATI said it insured close to $4 billion (about Sh412.56 billion) worth of trade and investments in 2016.
“While we continue to strengthen our ties with member countries, we are also expanding our global collaboration with international insurers and financial institutions, enabling ATI to become the go-to investment insurer in Africa for both international and domestic transactions,” Lentaigne said.