Evolving Banking Trends in Sub-Saharan Africa: Key Features and Challenges

By Mauro Mecagni, Daniela Marchettini, Rodolfo Maino

September 16, 2015

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Mauro Mecagni, Daniela Marchettini, and Rodolfo Maino. Evolving Banking Trends in Sub-Saharan Africa: Key Features and Challenges, (USA: International Monetary Fund, 2015) accessed November 23, 2024

Disclaimer: The views expressed herein are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Banking in SSA has undergone very significant changes over the last two decades. Financial liberalization and related reforms, upgrades in institutional and more recently the expansion of cross-border banking activities and the rapid development of Pan-African banking groups are signaling greater financial integration and significant changes in the African banking and financial landscape. Nonetheless, excess liquidity in many countries reflects limited lending opportunities and, despite improvements, asset quality and provisioning remain comparatively low. Dollarization has also been a persistent characteristic in several natural resource-dependent economies. This paper discusses key stylized facts and trends of banking development in SSA, looking at a variety of dimensions such as size, depth, soundness, and efficiency. It also assess the rapid expansion of pan-African banking groups, which have overtaken the role of the European and U.S. banks that had traditionally dominated banking activities in SSA, creating significant cross-border networks and becoming the largest participants in new syndicates and large bilateral loans to finance infrastructure development.

Subject: Bank credit, Banking, Basel II, Financial institutions, Financial markets, Financial regulation and supervision, Financial sector development, Foreign banks, International Financial Reporting Standards, Money

Keywords: Africa, Bank, Bank credit, Bank credit, Bank financing flow, Bank flow, Bank lender, Bank lending, Banking sector, Basel II, Central bank, DP, DPPP, East Africa, Financial crisis, Financial sector development, Financing flow, Foreign banks, Global, International Financial Reporting Standards, Lender, Pan-African bank Structure, Private bank, Strengthen bank supervision, Sub-Saharan Africa, West Africa

Publication Details

Pages:

39
Volume:

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DOI:

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Issue:

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Series:

Departmental Paper No. 2015/010
Stock No:

EBTSAEA
ISBN:

9781513598246
ISSN:

2616-5333

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