Congo's Third-Biggest Bank Changes CEO as Credit Is Squeezed

  • Anne Mbuguje to replace Michel Losembe from April 15
  • Bank has been limiting withdrawals after credit lines cut

Banque Internationale Pour l’Afrique au Congo, the Democratic Republic of Congo’s third-biggest lender, appointed a new chief executive officer as it struggles to deal with a liquidity squeeze that forced the bank to close temporarily last week.

The closely held lender named Anne Mbuguje as its interim CEO to replace Michel Losembe, who stepped down after being in charge since January 2013, according to a statement e-mailed by the Kinshasa-based bank on Thursday. The lender this week began limiting cash withdrawals after having the amount of credit it can access from the central bank cut by more than half.

“We are in the middle of a temporary liquidity crisis, but we are not at all at risk of bankruptcy,” Mbuguje told reporters in Kinshasa. She called on the government and the central bank to help BIAC maintain required liquidity levels and protect depositors’ savings. She said speculation of major withdrawals by account holders were false.

BIAC has been under central bank supervision since June, when the regulator conducted an audit and instructed the bank to improve profitability and increase its capital. The central bank cut lending to BIAC in February as part of a series of measures to reduce public spending and support the Congolese franc.

Withdrawal Restrictions

Signs in BIAC’s main branch on Boulevard 30 Juin in Kinshasa on Wednesday advised customers that cash withdrawals are limited to $500, or 500,000 Congolese francs, until further notice. BIAC has more than 400,000 accounts and total assets of $556 million, according to its website.

The banking industry in Africa’s biggest copper producer has been trying to rebuild consumer trust since average inflation of 684 percent during the 1990s and the collapse of several banks wiped out many people’s savings. The economy has grown at more than 7 percent a year for the past five years and the country now has 18 lenders. The slump in the prices of copper, oil and other key exports is threatening to check that growth, reducing foreign-exchange reserves and increasing pressure on the local currency.

“We recognize the work done by Michel Losembe in the last three years,” the bank said. “Thanks to him we have begun the restructuring program and accelerated the commercial development of the bank.”

Losembe, former head of Citigroup Inc.’s Congolese unit and current president of the Congolese Banking Association, will leave on April 15. He said the implementation of reforms to improve standards at the bank had been challenging during his time as CEO, given the operating environment in Congo.

“I remain very excited by the potential of this market but we still have a long way to go before this economy becomes competitive,” he said in a phone interview. “I had hoped to have a new term and to have the equity and the support needed to bring this bank to the next step but that was not feasible.”

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