Bank of Africa (BOA) Mali, which recorded a significant deterioration of its credit portfolio at the end of 2019, will experience at the "end of the second half" of 2020 an increase in the capital of the subsidiary, said Friday Abderrazak Zebdani, the deputy general manager of BOA Group.

Mr. Abderrazak Zebdani was speaking at a press conference, online, organized by the BOA Group, via the Microsoft Team platform. He said that this increase in the capital of BOA Mali should take place "towards the end of the second half of 2020".

Customers in growing difficulty who have not been able to meet their commitments, have burdened the expenses of BOA Mali (the oldest subsidiary of the banking group) which has "10 to 20 large customers who represent 30% of the portfolio" in the bank.

At the end of the 2019 financial year, the subsidiary recorded a loss of 6.9 billion CFA francs. Despite a net banking product in growth of 7.8%, shareholders will not receive dividends. The bank's performance has been wiped out by the exceptionally high level of risk provisions (17 billion CFA francs of downgraded receivables, 75% of which are on 5 files).

The decline in the bank's margin is due in particular to significant downgrades of loan files, partly made up by income from investment securities. This decline was largely made up by the increase in commissions (+23%, particularly on transactions and foreign exchange).

A remediation plan for BOA Mali has been put in place, involving the change and reduction of general management staff. In addition, a plan to reduce the bank's expenses was launched in late 2018. This should allow for a restructuring of equity.


These measures were discussed by the Board of Directors in February 2020 and subsequently voted by the General Assembly. Being listed on the Regional Securities Exchange (Brvm), the capital increase will have to follow a process before it becomes effective.

According to Mr. Abderrazak, a return to profitability is expected in late 2020. With the remediation plan, the banking group wants to enable its subsidiary to meet all regulatory ratios, which forced him to launch a capital increase to be able to regain the momentum of the bank.

He also noted that the health crisis of Covid-19 has not impacted the group's forecasts. However, the heading that is affected is visibly that of the commission with the closure of the borders.

This, he said, is explained by the fact that there is less international trade, fewer transfers abroad and transactions. However, the BOA Group's figures are "in line with the budget and budget forecasts made at the end of 2019".

The BOA Group, which is still in good health, has surpassed the 4 million accounts mark at the end of 2019. It is first in number of accounts with a market share in the Uemoa space that exceeds 17%.