(Business in Cameroon) - Thanks to the liquidity injection operations resumed in March 2020 in response to the coronavirus pandemic, commercial banks active in the CEMAC region were able to enhance their support to individual economic agents.
According to a recent article assessing the Covid-19 response measures initiated by the BEAC, despite the crisis, banks that refinanced themselves with BEAC liquidities were able to maintain their loans to the private sector.
"After the decline recorded between March and August 2020, the outstanding loans to the private sector gradually rose to reach XAF3,020 billion at end-March 2021," exceeding the March 2020 levels (XAF2,737 billion), the article informs.
In the said article, Ivan Bacale Ebe Molina, BEAC’s Director-General of studies, finance, and international relations, explains that the volume of outstanding credits to the private sector started rising around the period when the first liquidity injection operations were launched. According to the central bank’s executive, those operations aimed to offer the banking system adequate resources to help fund long-term employment, and one of the conditions to benefit from them was to promise not to reduce the volume of credits to the economy over the 12-month maturity period.
Ultimately, The liquidity injections boosted the credit portfolio in the CEMAC banking system between March 2020 and February 2021, despite the health crisis. Over the said period, the volume of outstanding credit in the CEMAC economy rose by XAF524 billion, from XAF7,785.6 billion to 8,309.6 billion. As for outstanding credit to private economic agents, it rose from XAF6,557.7 billion to XAF6,845.4 billion, representing a rise by XAF287.7 billion over the period under review. Those encouraging figures prompted the 1.3% growth forecasted by the BEAC for the CEMAC region for 2021, after a 1.7% recession in 2020.
Brice R. Mbodiam