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 lending and mitigating foreign exchange risks in Africa and other emerging markets.
The agreement, signed in The Hague, Netherlands, will see two rounds of investments to strengthen TCX’s capital base, expand its risk-bearing capacity and expand its ability to provide hedging instruments in illiquid and underserved African currencies.
This investment is expected to attract additional development finance institutions and private capital, reduce currency mismatches for borrowers, and support sustainable growth across infrastructure, energy, microfinance, small and medium-sized enterprises, and the public sector.
AfDB Group Capital Markets Development Manager Akane Zoukpo Sanankoua said the investment reflects the bank’s renewed confidence in TCX’s development mission and impact.
He said equity participation would help build more resilient financing structures for African economies and address currency imbalances, which remain a key driver of debt crises across Africa.
AfDB Group was a founding shareholder of TCX in 2007, but subsequently withdrew. This return strengthens its shareholder base, which includes FMO, the International Finance Corporation, the European Bank for Construction and Development, the European Investment Bank, KfW, the European Commission, and the governments of the Netherlands, Switzerland, the United Kingdom, France and Germany.
Since its inception, TCX has executed over $19 billion in hedging transactions worldwide, including $4.7 billion in 31 African countries, with significant exposure to vulnerable, low-income markets.
Ruhrd Brouwer, CEO of the Foreign Exchange Fund, said the return of the AfDB Group as a shareholder reinforces their shared belief that mitigating currency risks is essential to enable long-term, resilient financing for Africa.
He said the bank’s presence on the continent will help expand TCX’s reach and ensure that investments across Africa are protected from exchange rate fluctuations.
Jerome Laroche, Head of International Financial Institutions at the Dutch Ministry of Foreign Affairs, said the partnership reflects a shared commitment to sustainable development and innovative financial solutions in Africa.
The AfDB said the investment is in line with its 10-year strategy from 2024 to 2033 and its broader capital markets agenda, which focuses on expanding access to capital, deepening local currency debt markets and increasing private sector financing in domestic currencies.
