Ghana has secured official creditor approval for its $750 million loan from Afreximbank, sources told Reuters on Thursday.
The endorsement implies the African Export-Import Bank likely accepted losses, a step necessary for Paris Club approval, insiders said.
Paris Club sources described Ghana’s deal as “welcome,” signalling rich-nation lenders’ satisfaction with the restructuring of the loan terms.
Previously, the Paris Club insisted any approval required Afreximbank’s debt to be restructured in line with standard treatment parameters.
The agreement closes Ghana’s last major debt-restructuring hurdle, though it casts doubt on Afreximbank’s credit rating and preferred creditor claims.
Afreximbank said it had resolved the loan issues “to the satisfaction of both parties,” without confirming any losses taken.
Analysts warn any loss could lower Afreximbank’s rating, raising funding costs and affecting the bank’s financial standing internationally.
Paris Club approval likely came via a haircut on principal, maturity extension, or interest rate reduction, or a combination of measures.
Ghana announced the loan deal on Christmas Day, but details on terms and Paris Club responses remain undisclosed.
Sources said Paris Club considers loans from Afreximbank and the Eastern and Southern African Trade Development Bank commercial, requiring restructuring.
Ghana defaulted on external debts in late 2022, while Zambia did so in 2020, prompting both nations to seek loan restructurings.
Afreximbank has maintained publicly that its preferred creditor status protects it from losses, despite internal restructuring agreements with Ghana.
Zambia’s Afreximbank debt remains unresolved, though a third party reportedly expressed interest in assuming part of the liability last October.
Losses on loans could hurt Afreximbank with ratings agencies; the bank announced it was ending its relationship with Fitch on Friday.
Fitch warned previously that weakened preferred creditor status could trigger negative rating action, while Moody’s said losses would be partially offset by prior provisioning.
JPMorgan cut its outlook on Afreximbank bonds, citing the possibility the bank’s credit rating could fall to junk after taking a loss.
The deal signals a delicate balance between debt relief for Ghana and financial stability for Afreximbank, shaping West African lending markets.
