BEAC drops level of minimum reserves by 50%

In order to bring more liquidity to the coffers of the banks of the CEMAC member countries – Cameroon, Congo, Gabon, Equatorial Guinea, Chad and the Central African Republic – the central bank decided to drop by 50% the levels of the minimum reserves applicable to banks. This decision was taken during an extraordinary meeting of the Central African Bank Monetary Policy Committee held on 6 April 2016 in Yaoundé, the Cameroonian capital.

According the Lucas Abaga Nchama, Governor of BEAC, this decision taken following an observation on the “decrease in bank deposits” in the CEMAC area, will help release between FCfa 500 and 600 billion for the banks established in the CEMAC area. This money, the BEAC governor hopes, will help boost the economy’s financing in this community, in an environment of generalised drop in export revenues.

“We changed the prime rate a lot in recent times. Then, we increased the upper limit for refinancing with the central bank. Today, we are dropping the level of minimum reserves applicable to the banks in the sub-region. This demonstrates that the central bank did not passive against the situation which is impacting on our economies”, Lucas Abaga Nchama explained.