The National Reserve Bank of Angola (BNA) has clarified that the settlement of a letter of credit in favour of an exporter requires the debit from the importer’s account to be made in national currency (Kwanza, AKZ), through the exchange rate of sale of the foreign currency in the commercial bank on the settlement date.
The explanation that appears on a BNA’s official letter published last Saturday, comes from the Notice number 5/2018, from July 17, that goes over the rules and applicable procedures on the foreign exchange operations for the import and export of goods, and also the instruction number 4/2019, April 26, about the granting of credit, which clarifies that ”the granting of credit with capital indexed to a foreign currency is not allowed.”
Thus, banking institution are required to sell foreign currency to the importer on the date of settlement of the liability on the foreigner.
This rule applies regardless of whether the commercial bank used its foreign exchange position to settle the said liability or purchased foreign currency specifically for that purpose.
In the event that the importer does not have a sufficient account balance to cover the settlement referred above, the financial institution must grant a credit in national currency, in the amount of the deficit verified in the customer’s account in national currency, which cannot be indexed to any foreign currency.
In order to comply with the prevailing exchange rate provisions, all situations currently recorded in the books of banking financial institutions that contradict the new rules must be immediately regularized, so that the value of the credit granted to the importer is the equivalent in national currency on the date settlement in foreign currency under the letter of credit minus the balance in the importer’s account on the same date, available for the referred payment.