(Business in Cameroon) - In its recent Country Report No. 22/75, the IMF discussed the situation of UBC and NFC Bank, two private banks that were recently recapitalized by the Cameroonian government.
“In the near term, the Staff recommends signing performance contracts with each of the two banks, including a governance framework aligned with best practices, and a strategy for the State to sell its Shares,” the report indicates.
This recommendation comes just months after the government entered into the two banks’ shareholding. Indeed, in late November 2021, Cameroon officially took over UBC by acquiring 54% of the shares previously owned by Ecobank Transnational Incorporated (ETI). For NFC Bank, there is currently no official communication regarding the shares acquired by the government but, according to local media EcoMatin, it took over the shares previously owned by the Awanga and Co (58.2612%) and Mutuelle de retraite complémentaire des agents Eneo (24.4802%).
The advice may prompt Cameroon to avoid long restructuring plans as was the case with the Commercial Bank of Cameroon (CBC). The latter was going through a tumultuous provisional administration period (that lasted seven years) when, in 2014, the government of Cameroon took over 98% of its stakes owned by late businessman Victor Fotso at the time. Up to this year (2022), the government’s divestment from CBC is still ongoing.