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The
fiscal year closed on December 31st, 2003 was
marked by a particularly unfavourable economic
environment.
As
early as the first quarter of 2003, with the first
estimates of the coffee produce and the poor rainfalls,
it had become obvious that the path was heading
towards the end of the growth of the Burundian
economy observed in 2002.
The
slowing down, then the dropping down were confirmed
during the second semester in spite of a net resumption
of the international financial assistance, which
occurred, in fact, in a much tightened political
monetary context and prudential regulation.
The
Bank has been obviously affected by its repercussions,
the major impact being laid on the quality of
the credit portfolio, whose regulatory reassessment
by the Central Bank in the beginning of the exercise
was effected by more important provisions for
bad debts.
This
impact was cushioned, however, thanks to preventive
actions undertaken in the framework of strategies
adopted by the Bank at the end of 2002 and aiming
at a more rigorous supervision of credits, a trading
policy focussing on the increase of incomes and
a strict monitoring of operating overheads.
Those
actions were strengthened by the expansion and
the efficiency of a wide distribution network
which was supplemented by two new branches, in
Bujumbura, at the Bujumbura Harbour, and in Rumonge,
and three banking counters fully operating at
Bujumbura International Airport, Novotel Hotel
and in the Ministry of Finance Building.
Members
of the Board of Directors
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- Georges
COUCOULIS, President (middle)
- Callixte MUTABAZI, Managing Director
(third from left)
- Marguerite RUMBETE, Director (second
from right)
- Father Gabriel BAZIRUWISABIYE, Director
(first from right)
- Arturo COSTA, Director (first from
left)
- Bonaventure NICIMPAYE, Director (third
from right)
- Jean-Michel VIDAL REBATTU, Director
(second from right) |
Globally,
the fiscal year 2003 was closed with a net result
at the same level to the one of the preceding
year, which, given the environmental and regulatory
circumstances, should be considered as very satisfactory.
RESOURCES
POLICY
A
very little liquid one, the resource market was
marked by a strong competition on the deposits,
induced by the scarcity of the Central Bank refinancing
and the transformation of the clientele deposits
in Treasury Bonds, which are more profit generating.
As
in the past, the Bank has met such a context of
shortage thanks to the expansion of its basis
of resources through the reinforcement of its
"hard currency clients trading approach"
and the expansion of its distribution network
with five new entities.
Thus,
the year closed with a deposit of 48,970.3 M,
increased by 18.6 %.
CREDIT
RISK MANAGEMENT
Risk's
mastery
Due
to the particularly degraded economic environment
and the tightening of the prudential regulation,
the follow up and the control of risks, a long
standing pillar of the Bank's credit policy, have
been subject to a permanent concern in 2003.
Hence,
since the beginning of the year, a qualitative
classification of the credit portfolio has been
conducted in order to fix the priorities as far
as follow up and recoveries are concerned.
It
is on the basis of that classification that a
deep auditing of that portfolio has been conducted,
which enabled to improve the supervision by credit
officers.
In
the end, in spite of the reduction of deadlines
in provisioning bad debts, the provisions raised
at the end of the year remain in very satisfactory
proportions, with a waste rate of 2.4 %.
Credit
management
Following
the recommendations of the audit of the credit
portfolio, the credit management has laid a particular
stress on the optimization of the organization
and the management through a reformulation of
the duties of the credit manager.
The
latter's priorities are henceforth the design
of plans and objectives and the regular follow
up of performances of the credit officers.
Credits
outstanding
The
behaviour of the market of resources combined
with a credit policy giving priority to the control
of the outstanding and the strict supervision
of the portfolio have got a restrictive effect
on the evolution of the outstanding.
Hence,
at the end of December 2003, the total credits
to the economy were estimated to only 36,166.9
M versus 35,908.6 M the previous year, i.e. a
little increase of 1 %.
SERVICES
International
Banking
Due
to the net resumption of the international financial
cooperation, the Hard Currency Auction Market
has been regularly held in 2003, allowing a sustained
activity of the International Banking.
It
has been so since the resources from that market
have been supplemented by the resources of the
hard currency clientele, whose specific trading
approach enabled us to count among our clients
another important project, funded by the World
Bank, "Projet Santé et Population
II."
Counter
operations
Collection
operations in 2003 were conducted at sixteen counters
instead of eleven in 2002.
This
ongoing expansion of points of sales and their
work time schedules has the effect of treasury
flows growing important.
For
the year under review, deposits and transfers
operated at the Central Bank have thus amounted
to 42,711.3 M, as compared to 29,646.4 M in 2002,
while the daily encashment amounted to 3,362.0
M instead of 2,255.0 M the previous year.
Branch
network
In
2003, the Bank has given a new direction to its
distribution policy: the resumption of the establishment
of branches and counters on sites, with the Bujumbura
Port Branch and the counters at Bujumbura International
Airport, Novotel Hotel and in the Building of
the Finance Ministry, as well as the territorial
expansion of its network with the Rumonge Branch.
A
tremendous increase of inter branch exchanges
was noted with a flow between Bujumbura and he
countryside estimated to 58,134.1 M versus 56,959.8
in 2002.
OPERATIONS
PROFITABILITY
In
spite of the degraded socio-economic environment,
the preservation of the clientele intermediation
margin and the sustained activity at the International
banking have allowed to maintain he result at
its level of 2002, i.e. 1,110.5 M, versus, 1,085.3
M the previous year.
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Director's Report
