Wednesday, 18 February 2015

Rwanda: Banking sector faces challenges with high provisions for bad loans in 2014

Rwanda: 'Banking sector faces challenges with high provisions for bad loans in 2014 'KIGALI (TOA) - The central bank of Rwanda on Feb.17, 2015,. launched a new publication that shows how behavior of borrowers such as lack of information on loan conditions and culture of not bargaining with banks have contributed to inefficiencies observed in the banking sector as indicated by high interest rate spread during the fiscal year 2014.

Speaking at the presentation of 2014 national economic report,the governor of National Bank of Rwanda, John Rwangombwa noted that despite this negative trend, Rwanda's good economic performance of 7.8% recorded in the third quarter of 2014 was especially supported by significant increase in the economic financing by the banking sector as result of accommodative monetary policy.

"It has been a challenging issue for a number of local commercial banks as many borrowers were not in a position to repay their debt and this has resulted in non-performing loans," the Rwandan official told the Times of Africa (TOA) in Kigali.

Regarding external sector performance, trade deficit has slightly worsened in 2014 by 7.5% to USD 1,799.54 million from 1,674.38 million as a result of increase in imports value by 6.8% amounting to USD 2,399.3 million while exports moderately grew by 4.7% amounting to USD 599.76 million. Read More...

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