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Société Général Cameroon leads the leasing segment among the French banking group’s subsidiaries in West and Central Africa

Société Général Cameroon leads the leasing segment among the French banking group’s subsidiaries in West and Central Africa
  • Comments   -   Friday, 30 November 2018 17:47

(Business in Cameroon) - Among the subsidiaries of Société Générale in West and Central Africa, the Cameroonian unit provided the most leases, we learnt November 29 during a workshop the group organized in Dakar as part of its “Grow with Africa” strategy.

The Cameroonian subsidiary thus exceeds the Ivorian's which was the group’s leasing driver in West Africa with a recent increase by 77% in leasing portfolio over a year, a source at Société Générale Côte d’Ivoire said.

“The outstanding amount is higher in Cameroon because leasing was first launched there compared to Côte d’Ivoire. In Cameroon, the share of outstanding leasing is 13% of total outstanding (corporate loans), compared to less than 10% in Côte d'Ivoire,” said Georges Wega, the West Africa regional director, Societe Generale, and former Deputy MD of the Cameroonian subsidiary.

The latter also reveals that, given Cameroon's progress in the leasing segment, Société Générale Group has created a “hub leasing” for customers in Chad and the Republic of Congo.

“Our subsidiaries that are not yet on this segment (leasing) must reach it”  said Alexandre Maymat, Head of Africa, Mediterranean and Overseas at Société Générale Group, presenting leasing as one of the main segments the group plans to leverage as to increase outstanding loans to African SMEs by 60% (€4 billion, or more than CFA2,600 billion) over 5 years, as projected in its “Grow with Africa” plan.

Although leasing segment is still a minor player in Cameroonian Banking sector, significant progress has been made in recent years.

According to statistics from the Cameroonian Leasing Association (Camlease), reported in a document published by the International Finance Corporation (IFC), the Cameroonian leasing market has grown from about CFA45 billion in 2009 to over CFA115 billion in 2015.

Still in terms of value, the market has more than doubled over a period of 6 years, but experts said it remains below its potential, estimated at around CFA250 billion.

In practice, leasing consists, for a company, in financing the acquisition of its production tool by a lessor. The latter purchases the equipment, then makes it available to the company. The two parties agree on the terms of repayment, by draft, of the funds used to purchase this equipment, which will become the property of the company after full fund repayment.

This method of financing has the particularity of allowing companies to obtain the requested equipment without paying for it, use it directly to produce, and use production outcome to repay debt, in a rather flexible way

Brice R. Mbodiam, Dakar

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