Banking in Sub-Saharan Africa: What Went Wrong?

By Françoise Le Gall, Roland Daumont, François Leroux

April 1, 2004

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Françoise Le Gall, Roland Daumont, and François Leroux. Banking in Sub-Saharan Africa: What Went Wrong?, (USA: International Monetary Fund, 2004) accessed December 22, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The purpose of this paper is to study the origins of banking crises in sub-Saharan Africa, drawing upon the experience of ten countries during the period 1985-95. It examines, in particular, which factors were the most important sources of these crises. The conclusions underscore that the banking crises examined did not represent an entirely special case-a number of factors identified in the general literature, including macroeconomic shocks, were highly relevant-but note that several of their features were nonetheless specific to this part of the world. These banking crises were the very prototype of endemic crises associated with heavy government intervention in the banking system. In this regard, the paper analyzes the complex role of the government in banking in sub-Saharan Africa, the many channels through which governments intervened, and the economic and institutional environment in which the banks operated.

Subject: Banking, Banking crises, Commercial banks, Credit, Financial crises, Financial institutions, Foreign banks, Loans, Money

Keywords: Africa, Bank assets, Bank capital, Bank financing, Bank performance, Bank supervisor, Banking Crises, Banking crisis, Broad money, CFA franc, Commercial banks, Credit, Credit policy, Development bank, Foreign banks, Government Policy, Loans, Local bank, Macroeconomic Shocks, Private sector, Problem bank, Regulation, Risk-management practice, Sub-Saharan Africa, Terms of trade, West Africa, WP

Publication Details

Pages:

49
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2004/055
Stock No:

WPIEA0552004
ISBN:

9781451847659
ISSN:

1018-5941

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