The African Development Bank, AfDB has returned as a shareholder in the Currency Exchange Fund, TCX, with a $25 million equity investment aimed at deepening local currency financing and mitigating foreign exchange risks in African and other emerging markets.
The agreement, signed in The Hague, Netherlands, will see the investment deployed in two tranches to strengthen TCX’s capital base, expand its risk bearing capacity and scale up its ability to provide hedging instruments in illiquid and underserved African currencies.
The investment is expected to crowd in additional development finance institutions and private capital, reduce currency mismatches for borrowers and support sustainable growth across infrastructure, energy, microfinance, small and medium enterprises and the public sector.
Akane Zoukpo Sanankoua, division manager for capital markets development, AfDB Group, said the investment reflects the bank’s renewed confidence in TCX’s development mandate and impact.
She said the equity participation would help build more resilient financing structures for African economies and tackle currency mismatch, which remains a key driver of debt distress across the continent.
The AfDB Group was a founding shareholder of TCX in 2007 before exiting. Its return strengthens a shareholder base that includes FMO, International Finance Corporation, European Bank for Constructions and Development, European Investment Bank, KfW, European Commission and the governments of the Netherlands, Switzerland, the United Kingdom, France and Germany.
Since inception, TCX has executed over $19 billion in hedging transactions globally, including $4.7 billion across 31 African countries, with strong exposure to fragile and low-income markets.
Ruurd Brouwer, chief executive officer, Currency Exchange Fund said the AfDB Group’s return as shareholder reinforces the shared conviction that currency risk mitigation is critical to unlocking long term, resilient financing for Africa.
He said the bank’s continental footprint would help expand TCX’s reach and ensure investments across Africa are insulated from exchange rate volatility.
Jerome Larosch, head of division, international financial institutions, Dutch Ministry of Foreign Affairs, said the renewed partnership reflects a shared commitment to sustainable development and innovative financing solutions for Africa.
The AfDB said the investment aligns with its Ten-Year Strategy 2024 to 2033 and broader capital markets agenda focused on scaling access to capital, deepening local currency bond markets and expanding private sector financing in domestic currencies.
