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Togo: Banks Postponed Loan Repayment Deadline 438 Businesses And 1,500 Individuals

Togo: Banks Postponed Loan Repayment Deadline For Nearly 438 Businesses And 1,500 Individuals

According to the BCEAO’s relief incentive, banks in Togo have postponed loan repayment for at least 438 companies and 1,454 citizens. Sani Yaya, the minister of economy and finance, announced this last Thursday. Overall, the repayment of CFA28 billion has been postponed to give companies and people affected by the current health crisis some breathing space.

The opportunity was launched on March 21, 2020, when the subregion was experiencing a pandemic. Banks were able to put back loan repayment deadlines for companies impacted by the health crises and associated counter-measures that requested an extension under its terms.

Lenders could grant these individuals three months to settle their debts, reversible once. No interest, tax, or provision for late payment was to be paid during this period.

Banks will then classify the deferred debts as good debts without affecting their performance, portfolio efficiency, cost of risk, profitability, or equity.

“The classification of deferred maturities in a specific account in the category of sound loans will also alleviate the fear of banks regarding a potential spread in case of default on the original loans, due to exposures worsening as a result of granting additional facilities to allow debtors to resume activities so they can honor their commitments,” According to Kossi Djokoto, a financial analyst at Togo’s Attijariwafa bank (BIA).

In terms of new loans, banks issued CFA590 billion in 2020, bringing the overall amount of bank loans into the economy to CFA1,306 billion. Minister Yaya hails this cumulative number as accounting for 30% of the rebased GDP, a remarkable achievement in absolute terms.