Rwanda

Emerging markets private equity investor Actis acquired an 80% stake in Banque Commerciale du Rwanda (BCR) in September 2004. BCR is the second largest commercial bank in Rwanda, with a strong brand and branch network but had a large NPL book, a legacy of the genocide and the chaos that ensued. But, by the end of 2005, there were clear signs of a successful turnaround. BCR reported a profit of RwFr1.04bn ($1.9m) and a 22% RoE.

Key features of the turnaround include aggressive recovery of bad debts. Almost RwFr1.5bn has so far been recovered, which together with write-offs has slashed the NPL ratio from 56% to 28%. At the same time, BCR grew its loan book by 150% in 2005, though not before beefing up credit processes.

The bank has also clearly set the standard in terms of marketing, improving customer service and expanding its points of presence. It also launched several new products.

“BCR grew its assets and liabilities more than any other bank in Rwanda in 2005. This was explained by more banking penetration and attracting customers from other banks. Rwanda has never seen this before,” says managing director David Kuwana.