Bank of Africa
2005 was another turbulent year for the Malagasy economy. Gross domestic product growth of 4.6% was recorded, with exports recovering and improved performance in the manufacturing, construction and tourism sectors.
But high oil prices and a duty exoneration scheme (leading to more imports) pushed the current account deficit to more than 10% of GDP by year-end. Power supply problems (and a delicate political situation thwarting necessary reforms to resolve them) impacted businesses. This followed difficulties in 2004 when devastating cyclones hit vanilla harvests and food staples such as rice. When the country turned to expensive imports, inflation soared to more than 17%.
In spite of the challenges, Bank of Africa increased its investment in its Malagasy operations, more than doubling Tier 1 capital. Profits responded, ending 2005 up more than 40% at MgA15.2bn ($7.3m).
The judges also noted ongoing investment in the branch network; alternative channels such as ATMs and the internet; and back-end technology. Despite moves to increase salaries in the bank to industry levels, overall cost increases were held below inflation.
“Receiving this award affirms our strategy, which we have been pursuing for the past seven years, to bring affordable banking services to all sectors and all customers in Madagascar,” says director-general Alain Lepatre-Lamontagne.
