2023-09-29 07:41:17
Sacrificing to tradition, the National Directorate of the BCEAO and the Professional Association of Banks and Financial Institutions of Benin (Apbef-Benin) held, Thursday, September 28, 2023, their 3rd consultation meeting for the year 2023 in the agency premises in Cotonou. A series of current topics were reviewed on the occasion, in particular, the examination of the 2022 report of the Banking Commission, the challenges faced by the Beninese banking system in terms of compliance with banking regulations and many more. ‘others.
Sylvestre TCHOMAKOU
“Basically, if we should issue an opinion on the Beninese banking system, after our meeting, it is a place that is doing well, which continues to finance economic activity, even if there is still progress to be made “. This is, in essence, the conclusion reached by the National Director of the BCEAO (DN/BCEAO), Emmanuel Assilamehoo, at the end of the 3rd meeting between the BCEAO and APBEF-Benin for 2023. Taking place in a difficult socio-political context in the sub-region (closure of borders with Niger, reforms in the hydrocarbon sector in Nigeria, etc.), this quarterly meeting was an opportunity for players in the Beninese banking market to examine, at the level of Benin, the report for the year 2022 of the Banking Commission which was recently published. In terms of performance, according to the National Director of the BCEAO for Benin, with the said report, it became clear that there are many positive points for the banking center of Benin which, from the point of view of solvency, is solid. “It is a financial center that is solvent,” he said during the press briefing marking the 3rd meeting. Still, among the positive points in Benin’s banking sector, satisfactory results were noted in terms of net banking income. Better still, thanks to the work of the banking system, the support of the authorities of the Ministry of Economy and Finance, as well as justice, the banks’ credit portfolio, explained Emmanuel Assilamehoo, “has been truly cleaned up”. “Three or four years ago,” he said, “we had rates of gross deterioration of the portfolio which were well above the Union average. Today we are below the Union average.” In terms of prudential system, the Beninese banking center is also a good student of the BCEAO. With a view to sustainable growth of Benin’s banking sector, the representation of the issuing institute did not simply review Benin’s performance.
Strengthen cash flow and review the lending rate
From the report examined, noting a low or even virtual absence of cash flow specific to the banks of Benin’s financial center, which leads to their refinancing by the BCEAO, as is the case in other countries, the DN/BCEAO for Benin insisted on the importance of improving bank liquidity. “The Benin banking center should be able to strengthen its own treasury,” he urged, before adding: “What we call own treasury is what the bank itself has, without refinancing of the Central Bank. So if the central bank did not refinance a bank, what does it itself have, because of what it generates, because of what the shareholders have put as resources into the bank, because of the other long-term capital or the products it was able to generate. (…) Banks must improve the match between their resources and their uses.” In terms of remuneration of term deposits, noting that the financial center of Benin continues to remunerate term deposits at rates much higher than the Union average, which impacts credit rates, the banks of the place were asked to improve their regulatory compliance. Speaking on the occasion, the Vice-President of APBEF, and CEO of Coris Bank Benin, Jean-Jacques Golou, while specifying that the Beninese banking system is not short of liquidity, specified: “We are in an environment where we are in full investment. Benin is in the process of being planned, and therefore, this puts pressure on the liquidity of the banks.” “To improve it,” he added, “we continue to work on actions relating to financial inclusion to bring as many operators as possible into the formal sector, so that liquidity is further strengthened to finance the business projects. This should make it possible to reduce the cost of bank loans.
QA September 29, 2023
#solvency #Beninese #banking #system #solid