Business & Industry
Sep 1, 2016
BANCO SOL, 15 YEARS OF EXPERIENCE IN BANKING FOR DEVELOPING ANGOLA
After 15 of existence, Banco SOL has reached a size that means a strong reference within the range of 27 banks that operate in Angola. However, it is not to be the biggest that motivate Banco Sol, it is to be among the best, open the way for an international expansion in competitive terms.
With more than 600,000 accounts of clients, more than 180 branches in Angola and almost 200 million of Dollars of Own Funds, Banco SOL is already a reference among banks in Angola e is starting its way to become an international bank, either in neighbour countries, or in other regions where it may serve better the clients, Angolan or foreigners.
Between 2002 and 2014, Angola was among emerging countries with higher economic growth rates, taking advantage of an environment of political peace, social stability and better human development level, having been possible to rebuild and modernize infrastructures, to expand education and to ameliorate living conditions of millions of Angolans of all the ages. Incorporated in 2001, Banco SOL has benefited from this growth cycle to consolidate as a bank, but also to contribute to that growth process in Angola. Along those years Banco SOL has grown in a sustainable way and year after year have generated dividends for its shareholders and has accumulated reserves for reinforcing the Own Funds.
Coutinho Nobre Miguel, the Chairman and CEO, told us "after its consolidation in Angola, Banco SOL is now strengthening new areas, such as private banking and investment banking, enlarging the set of services available for clients, either individuals or companies or investors, creating conditions to initiate a cycle for new businesses in Angola and in other countries where is going to operate. We are open to work with new partners, interested in following the new trends of progress of Angola and other African countries".
It is important to emphasise that such policy of consolidation has been conducted in a socially responsible way, and a similar high priority has been always awarded to the creation of innovative mechanisms of support to the inclusion of more vulnerable social sectors, as it was the case of agriculture campaigns for farmers or preferential loans for teachers and students. Those are two examples of the innovative schemes created by Banco SOL, and that have been recognized by public and private institutions, including large foreign corporations working in Angola that have chosen Banco SOL as an agent for social inclusion incentive programs. In fact, it is important to remember that Banco SOL, since its inception in 2001, was the initiator of microcredit in Angola, having supported, throughout these years, more than 100,000 clients with small loans of an average amount of 1,400 Dollars, which have helped many families to create a base of income that has contributed to ameliorate their living conditions.
However, since the mid of 2014, Angola, as well as many other oil producing countries, has initiated a cycle of great financial difficulties due to the drop of the oil price, which has provoked a deep reduction of the economic growth rate and the reduction of the purchasing power of the population.
Nevertheless, Angola keeps exporting 1.8 million barrels of oil per day, what places Angola as number one exporter of oil in Sub-Saharian Africa, but the revenue from the export of oil went down about 50 %, implying a deficit in the balance of payments, as well as in the State Budget. Banco SOL has been able to adjust to this new conjuncture, and was even able to increase its own solvency, and profitability. Notwithstanding the existing difficulties, thanks to the trust of the depositors, Banco SOL has succeeded to keep increasing credits to companies, but minimizing risks, and to reinforce credit to the State for supporting essential public investments that assure the maintenance of the growth, and its crucial role in the gradual stabilization of the economy.
With such recent situation in Angola two stabilization factors have been essential: on one hand, the existence of substantial accumulated exchange reserves that compensate the reduction of export revenue; and, on the other hand, the contribution of the Angolan Banks for the placement of Public Debt for allowing to keep the role of the State expenses for investment and consumption.
Angola is today one of the largest economies in Africa, with a GDP (in power purchase parity) above 180 billion Dollars and a population of approximately 25 million inhabitants. In the next decades Africa will be one of the Continents with higher rates of economic growth where it is expected a larger amelioration of human development, through better living standards for more than one billion people, of which 400 million live in cities, being the growing urbanization one of the more preeminent features of the future of Africa.
The banking sector in Angola has performed with success a key role in promoting economic and social development in the Country during the last few years, making it an example that is important to be followed in other countries with a similar or lower level of development, as the quality of banking services in Angola, according to the best practices and international standards, has helped individuals and companies to launch their businesses and to manage their savings.
At the same time, the central bank BNA (Banco Nacional de Angola) has also increased its role as supervisor following the international patterns for assuring the maintenance and increase of the focus of financial institutions in quality and sustainability in the long range.
Banco SOL is nowadays recognized as a case of success in banking in Africa, serving more than 600,000 depositors and leading a prudent and efficient credit policy, inclusively with microcredit instruments, but avoiding to deteriorate solvency and profitability, and achieving solid levels according to any international criteria.
The national development policy of Angola is oriented for the reduction of the still too high weight of the oil & gas sector, through the support of an aggressive diversifying policy, from which positive results at a short and medium term are expected. The main role of the Government is to keep investing for the construction of new and modern infrastructures, such as roads, railways, social housing, energy, water supply, sewage, etc., with the support of lines of credit from friendly countries, but also the private sector and the foreign investment is receiving the attention of the Government, in order to increase their important role in diversifying the economy, generating new companies, and more jobs.
Banks operating in Angola are playing a key role financing the private sector with the support of the State through a special program called "Angola Investe", especially directed at the development of micro, small, and medium companies in many sectors, from agriculture to industry, tourism, among other sectors. But it is also important to mention that the urban development and the real estate promotion are also attracting investments in several cities, mainly the capital, Luanda, modernizing the traditions of this city, one of the oldest in Africa, with more than four centuries, and where more than seven million people live.
For investors that search for new business opportunities in Africa, Angola is one of the countries with better conditions to attract more foreign direct investment, not only in the oil & gas sector, but also for diversifying traditional sectors, such as agriculture, fishing, and mines, and new technologies, such as telecommunications.
After 15 years of operating in Angola, Banco SOL is recognized as one of the best and safest partners by many official and non-governmental institutions, as well as many international groups operating in Angola, either for using programs of microcredit, or for trade finance, and project finance. Banco SOL is ready to be the partner of investors that may wish to take advantage of the opportunities that Angola offers, and are essential to proceed with its development.