“The new legislation proved to be a significant challenge to some of the mining companies operating in the DRC. What we can do as a bank is to educate and assist clients in adapting to the new code.”
Can you please provide a brief overview of BCDC and some recent company milestones?
BCDC has existed for 110 years and is likely the oldest company in the DRC. We are also the second largest bank in the country measured by balance sheet. The bank is jointly owned by a Belgian family-owned group that has been active in Congo for almost 100 years now and the Congolese state, which are the two largest shareholders. Historically, BCDC has been very active within the corporate sector. Retail banking is something quite new in the DRC as banks only started to develop a strategic approach to retail clients in 2011. Today, we have a significant foothold in the retail sector, which not only encompass individuals but small to mid-size companies as well. Nonetheless, the majority of the DRC population does not have bank accounts, and banking in the DRC has a long way to go.
One of the main challenges for the domestic banks is access to stable funding, and therefore the diversification into the retail sector was necessary. Although it is improving, the sources of funding in the country are scarce and highly volatile. At this stage, it is still difficult for us to provide long-term credit to clients, which is a necessity for the economy to grow. This is why it is essential for us to develop all the possible sources of funding.
With regards to BCDC’s earnings, the company has been performing well, even when the economy was not at its best. What is BCDC’s strategy and how has the company managed to maintain this performance?
BCDC’s continuous strong performance is due to a key feature of the bank – very tight risk management. We consider ourselves prudent, and we never forget that our deposits are not our money but rather the money of our clients. Both our credit risk management and operational risk management are central, and we do our best to prevent accidents and exceptional events with potential to harm the bank. From a long-term perspective, BCDC is improving its metric steadily. Our high earning results of 2016 are also the result of some gains we made from currency exchange when the volatility of the Franc compared to U.S. dollars increased significantly.
What is BCDC’s role in the mining industry and can you provide some insight into the bank’s mining client base?
Mining is crucial to the DRC’s economy. BCDC only addresses official clients as opposed to developing commercial relations with the informal mining sector. Traditionally, our clients are the major players within the mining industry, but we also work with small to medium-sized companies as well as contractors. We are always looking for new mining clients with the only criteria being that they are registered.
What is BCDC’s perception of the new mining code’s effect on the sector?
The new legislation proved to be a significant challenge to some of the mining companies operating in the DRC. What we can do as a bank is to educate and assist clients in adapting to the new code. Banks are not only a financial provider to clients, but rather a partner as we work hand in hand.
Digital banking is growing in emerging economies. What is the importance of digital tools for BCDC and what are some recent digital developments?
Digital banking is not as advanced in the DRC compared to western countries, especially because of the absence of a real digital payment ecosystem. Currently, we have tools such as mobile banking, home banking and computer banking. In terms of the retail sector, banks in the DRC have developed good solutions for mobile banking to provide clients with an easy way to communicate. From our corporate clients, there is increasing demand for efficient, safe and practical online banking solutions, and we are adapting to these changes. Another field where digital banking is becoming more important is in trade finance reporting. We utilize tools, some even set up by authorities, to digitally report activities.
Is there any collaborative approach to funding major mining operations in the DRC?
The banking sector should increase collaboration to improve their capacity for funding major projects. Some banks are actively financing programs in partnership with international banks, but there is still a significant room for improvement.
What is the most crucial element for the country’s financial growth?
One of the greatest challenges in the region is the diversification of the economy. There is still great potential in terms of mining developments, but the country needs to diversify to grow its economy and spread risk.