In 2016 BANK OF AFRICA – RWANDA (BOA–RWANDA) published its first year accounts as a full commercial bank. Until end of 2015, it was a micro finance institution. Significant investment was required to bring about this transition, in particular in terms of head office and branch relocation and new branding.
Net income, not a significant indicator given the exceptional context of this financial year, was down 1,271.5%.
Given this same context, operating expenses understandably increased by 78.8%, in particular due to the recruitment of new staff, mainly to fill key positions. With investment in a new core banking system and new IT infrastructure, depreciation and amortization costs also contributed to that increase.
All unsecured loans have been fully provided for, resulting in an increase in the cost of risk, which was also affected by the allocation of provisions for all accounts with negative balance for more than a year and for which no line of credit had been granted.
These two measures resulted in an increase in the cost of risk of 557.6%.
Net loans and advances rose by 46.2%, a performance in line with market opportunities.