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DRC: formalization of SMEs, one of the prerequisites for obtaining bank credit

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The formalization of Small and Medium Enterprises (SME) was at the heart of the debate, this Thursday, June 13, 2019, one of the workshops of the French Week in Kinshasa Pullman Hotel. It is one of the prerequisites for obtaining a bank credit requested by any entrepreneur.

“Every entrepreneur needs to expand his business at some point. He is tempted to go to the bank. But, the financing takes into account the profile and certain criteria”, said Jisca Mahongo, representative of Equity Bank, intervening in this exchange panel.

It is clear that the loan in a bank requires a certain amount of information including official documents recognizing an SME as a society under Ohada Law.

Moreover, this Equity Bank framework explained how banks take into account risk assessment of projects, business opportunity, etc. In the formalization, it is also a question of updating the financial statements and continuing training. Because, to borrow is to engage.

It is therefore difficult for a bank to accept a project from a person who leaves the agri-food industry for the sake of illustration. Since the contours of the new choice have not been identified, such a request is hardly acceptable.

The bank, like Equity, does not just show up as a money lender. But also as a counselor. All the mechanisms issued by banks to reduce risks, see the willingness of the entrepreneur to move forward.

Hence, the need to inform SMEs so that they are better prepared. Only in this way can they obtain financing from the banks.

Harris KASONGO

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Congo: UBA DRC represented by its general manager at the 5th Forum Investing in Africa

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Congo: UBA DRC represented by its general manager at the 5th Forum Investing in Africa

United Bank for Africa (UBA) DRC was represented at the fifth Forum Investing in Africa (FIA5) held from 10-12 September 2019 in Brazzaville, Republic of Congo. Its CEO, Patrick Kabisi, was the only panelist selected in the Congolese banking sector.

He intervened in the session on Human Capital Development as an analyst of the changing demographic and social environment.

Patrick Kabisi focused on areas where investment is needed, not only to close the gap in basic services, but also to help people become innovators, entrepreneurs, leaders and autonomous citizens, regardless of their income level.

These reflections also focused on opportunities for knowledge exchange and collaboration between African countries, China and the rest of the world on key institutional, regulatory and technological reforms.

Sub-Saharan Africa lags behind in most human capital indicators, and estimates show that the continent is only operating at 40% of its potential despite recent progress in health and education indicators.

At the same time, a skills gap hinders countries’ competitiveness in the global economy.

The objectives of the AIF5 were to examine how best to support economic diversification and job creation in African countries; to take stock of progress made and should chart the way forward.

Emilie MBOYO

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DRC: Moody’s reiterates its positive assessment of the BCDC

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DRC: Moody's reiterates its positive assessment of the BCDC

Despite the high country risk of DR Congo, Moody’s rating agency has just reiterated its positive assessment of the Banque commerciale du Congo (BCDC). In a publication relating to its “credit opinion” of 6 September 2019, it included in a more detailed manner the elements justifying Caa2’s ratings on long-term deposits with a stable horizon and Caa1 on long-term counterparty risk assigned to this Congolese bank.

Banque commerciale du Congo enjoys a predominant position in the large corporate sector, a large stable deposit base and excellent liquidity, but operates in the difficult environment of the Democratic Republic of Congo,” said Yves Cuypers, BCDC’s Executive Director in a statement to Zoom Eco.

Indeed, it is not possible for a banking institution, in the international rating system, to exceed the rating assigned to the country in which it has its residence and main activity. Congo DR has recently seen its sovereign rating downgraded from B3 negative to Caa1 stable.

Logically, it follows that no Congolese bank can be assigned a higher rating than that assigned to DR Congo. What is more normal than BCDC’s Caa1 rating means that the bonds are speculative and subject to high credit risk.

However, BCDC’s efforts are acknowledged by Moody’s, which welcomes the announced acquisition of a majority stake in BCDC by the Equity Group.

Moody’s has published an (issuer comment) considering that this potential acquisition would be mutually beneficial for both the Banque commerciale du Congo and Equity Group Holding,” insisted Yves Cuypers.

Eric TSHIKUMA

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DRC: Moody’s gives BCDC a “Caa2” rating on long-term deposits

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DRC: Moody's gives BCDC a "Caa2" rating on long-term deposits

Moody’s, one of the world’s leading rating agencies, has assigned two ratings to the Banque commerciale du Congo (BCDC). These are Caa2 on long-term deposits with a stable horizon and Caa1 on long-term counterparty risk. According to an official statement from the bank, these two ratings correspond to a speculative environment. Below, the details:

DRC: Moody's gives BCDC a "Caa2" rating on long-term deposits

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