Bank credit to the economy of Cape Verde grew 1.2% in the second quarter of the current year, to 134.2 billion escudos, the equivalent of US$1,44 billion, an amount higher than the US$1,42 billion recorded in the first quarter of the year, according to provisional data from a statistical report by the Bank of Cape Verde (BCV).
The BCV note reveals that, out of the total credit granted to the economy, up to the end of June, about 7.8% corresponds to securitised debt and the remaining 92.2% of bank loans were destined to companies, including the non-financial public institutions.
In 2020, the volume of banking credit to the Cape Verdean economy grew by almost 4% compared to the previous year, to US$ 1,39 billion, an increase explained by the ‘covid-19 loan credit lines’.
Cape Verde’s banking and financial market regulator started, just over a year ago, the implementation of economic incentive measures for the mitigation of pandemic-related crisis, providing funds to banks and encouraging credit lines to companies, to support economic recovery.
The central bank implemented monetary policy measures, in which loans for up to three years continue with an interest rate of 0.75%, so that credit institutions can continue to finance the economy at reduced costs. Furthermore, the Bank will maintain benchmark interest rates and the current long-term financing programme, through the Monetary Financing Operation (OMF), until December 31, 2021.
The Government of the Portuguese-speaking country announced the extension of the moratorium regime on the payment of capital and interest on bank loans until March 31, 2022, a measure also taken precisely to mitigate the economic consequences of coronavirus.