Lomé, fi­nan­cial cap­i­tal of Africa

Togo’s bank­ing sec­tor is boom­ing. In re­cent years, sev­eral for­eign bank­ing groups with pan-african am­bi­tions have opened their doors in the coun­try and are sup­port­ing its eco­nomic devel­op­ment.

The Africa Report - - POLITICS -

The fi­nan­cial at­trac­tive­ness of Lomé is not new. Since 1985, Togo’s cap­i­tal city, Lomé, has been home to the ECOWAS Bank for In­vest­ment and Devel­op­ment (EBID), the fi­nan­cial arm of the Eco­nomic Com­mu­nity, and the West African Devel­op­ment Bank (BOAD), com­mon to the eight WAEMU mem­ber coun­tries. Lomé is also where African bank­ing group Ecobank, the big­gest on the con­ti­nent by num­ber of es­tab­lish­ments, chose to set up its new head­quar­ters, fac­ing the At­lantic, in 2011. This de­ci­sion af­firmed the credit granted to Togo by this in­creas­ingly pow­er­ful pri­vate group, es­pe­cially since its es­tab­lish­ment in neigh­bour­ing Nige­ria. Ora­bank, the lead­ing pan-african bank in terms of its bal­ance sheet to­tal, also chose Lomé as the lo­ca­tion for its head­quar­ters.

The net­work has dou­bled in size in 10 years

The po­lit­i­cal cri­sis in the coun­try slowed down Togo’s fi­nan­cial am­bi­tions. Since it ended, around ten years ago, the bank­ing net­work has dou­bled. In 2005, Togo had only a hand­ful of banks. In 2006, when it set up in the coun­try, Banque At­lan­tique set in mo­tion a trend that con­tin­ued to gather mo­men­tum. Nige­ria’s Di­a­mond Bank opened its branch in 2011, At­ti­jari­wafa Bank took over BIA-TOGO in 2013, Bank of Africa en­tered the mar­ket by open­ing its first agency in Lomé the same year and Ora­bank merged with the Banque To­go­laise de Développe­ment (To­golese Devel­op­ment Bank), when it pri­va­tised in 2014. In 2015, fol­low­ing the trend, Coris Bank In­ter­na­tional and So­ciété Générale were the new­com­ers, and United Bank for Africa is ex­pected to fol­low suit.

A bank for ev­ery bud­get

So­ciété Générale is po­si­tion­ing it­self in Togo to at­tract big com­pa­nies and the State, whose projects it is keen to sup­port, in par­tic­u­lar in­fras­truc­ture. A num­ber of other in­sti­tu­tions, such as At­ti­jari­wafa Bank, are set on im­prov­ing the na­tional banked pop­u­la­tion rate by choos­ing to woo the gen­eral public, push­ing into the hin­ter­land to build a clien­tele of pri­vate in­di­vid­u­als.

This year Ora­bank ben­e­fited from an African Devel­op­ment Bank loan so that it could bet­ter con­trib­ute to the fi­nanc­ing of SMES and projects de­vel­oped by young en­trepreneurs. This am­bi­tion is in line with the Sup­port­ing Em­ploy­a­bil­ity and Youth In­clu­sion Project (PAEIJ-SP).

An ac­tive and at­trac­tive mar­ket

The rea­sons for this en­thu­si­asm are nu­mer­ous, start­ing with an eco­nomic growth above 5% for the past three years. Added to this is the clear im­prove­ment in the busi­ness cli­mate. In re­cent years Togo has in­vested so that it can pro­vide busi­nesses with the ad­min­is­tra­tive and phys­i­cal in­fras­truc­ture nec­es­sary for their growth. Eco­nomic op­er­a­tors, many of whom have taken ad­van­tage of th­ese op­por­tu­ni­ties, at­tract bank­ing struc­tures keen to be a part of this boom. The po­lit­i­cal sta­bil­ity of a coun­try that is ex­pect­ing to reap the div­i­dends from its in­vest­ments is also likely to re­as­sure busi­nesses.

En­cour­ag­ing ra­tios

Bol­stered by its eco­nomic devel­op­ment, ur­ban­i­sa­tion and in­creased in­fras­truc­ture de­ploy­ment, Togo is now see­ing the emer­gence of a mid­dle class and an in­dus­trial fab­ric with grow­ing and di­ver­si­fy­ing bank­ing and fi­nan­cial ser vices needs. Togo’s banked pop­u­la­tion rate is now the strong­est in the WAE MU zone, hav­ing risen from 3% to 8.5% in the last five years. Ac­cord­ing to Cen­tral Bank of West African States data, the de­posit/gdp ra­tio is 38%, well above the WAEMU zone av­er­age of 25%.




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