Africa Finance Corporation (AFC) has closed a US$400 million Shariah-compliant Commodity Murabaha facility, marking its return to the Islamic finance market for the first time in eight years.
The Chief Executive Officer of AFC, Samaila Zubairu said in a Bloomberg TV interview on Friday.
Initially launched at US$300 million, the facility was upsized to US$400 million due to overwhelming investor demand, with a 47% oversubscription.
The transaction attracted participation from eleven leading Islamic financial institutions, including first-time partnerships with Abu Dhabi Islamic Bank PJSC, Al Rajhi Bank, and Emirates Islamic Bank.
“This transaction reaffirms AFC’s role as a bridge between global capital and Africa’s most urgent infrastructure needs,” said Zubairu.
“The overwhelming demand demonstrates strong confidence in our investment strategy and Africa’s increasing importance in the Islamic finance landscape. By expanding our international funding sources, we continue to create innovative financial solutions to drive impactful and sustainable development across the continent.”
Emirates NBD Capital Limited, First Abu Dhabi Bank PJSC, and SMBC Bank International Plc acted as Joint Lead Arrangers and Bookrunners for the transaction, reinforcing AFC’s strong relationships with leading global financial institutions.
AFC’s Expanding Footprint in Islamic Finance
The transaction builds on AFC’s track record in Islamic finance, including its US$230 million Sukuk—the first-ever by an African supranational entity—issued in 2017. AFC continues to broaden its funding portfolio with innovative transactions that attract global investors to African infrastructure projects.
In January 2025, AFC raised US$500 million from its first perpetual hybrid bond, further solidifying its financial strength. Additionally, the corporation received the highest possible credit ratings from S&P Global (China) Ratings and China Chengxin International Credit Rating Co. Ltd (CCXI) ahead of a potential panda bond issue, showcasing its credibility in global capital markets.
Ensuring Compliance with Global Islamic Finance Principles
This financing facility was structured in accordance with standards set by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), ensuring full compliance with global Islamic finance principles.
Islamic finance, including Murabaha structures, is widely regarded as ethical and sustainable due to its emphasis on asset-backed financing, risk-sharing, and the prohibition of speculative practices. These principles align with AFC’s mission to foster responsible investment that promotes long-term infrastructure development and economic stability in Africa.
AFC’s Vision for the Future
“Islamic finance plays a growing role in our funding strategy, helping us tap into a diverse pool of investors who share AFC’s commitment to sustainable and responsible investing,” said Banji Fehintola, Executive Board Member and Head of Financial Services at AFC. “The success of this Murabaha facility highlights the strong appetite for African infrastructure investments and underscores AFC’s ability to structure transactions that meet global investor expectations.”
With this latest financing success, AFC continues to strengthen its position as Africa’s premier infrastructure finance institution, leveraging diversified funding sources to drive sustainable economic growth across the continent.
