The Commercial Bank of Rwanda (BCR)  has made significant progress  with  expectations  to close the year with a profit margin higher than half a billion Rwandan francs for this year, after  a period of recurring losses, the Central Bank Governor has said.

This follows a courtesy   visit by the Central Bank management to the BCR Head Offices on Wednesday.

"To be precise this year the bank will close books with a significant profit higher than half a billion more than practically a period of losses in 2008. They were obliged to make huge provisions and now the bank is coming back to profitability,” François Kanimba, the Central Bank Governor revealed to Business Times at the end of his visit.

The Governor observed that the bank has made commendable progress in improving its operations in the recent months hence its expected improved profitability. 

According to Kanimba, the bank has addressed the inadequacies in risk, credit and portfolio management competencies identified by the Central Bank inspection of the bank last year.

"The bank is making very important progress not only in terms of implementing recommendations made by the Central Bank but even going beyond to transform the whole banking system.

The progress made so far – the performance in terms of improving profitability of the bank is beyond our expectation,” he said.

BCR has made progress in building its risk management department, customer care service and created a conducive environment for its customers and employees.

"A year and half ago, if you came to BCR offices, the queues were terrible! But I was surprised today the queue issue has been addressed,” Kanimba said, referring to the bank’s improved customer care service.

However at the beginning of this year, BCR reported a significant drop in its net profit from Rwf3.1 billion in the previous year to Rwf897 million in 2008. Its pre-tax profit declined by 50 percent to Rwf1.7 billion in 2008 from Rwf3.5 billion in 2007.

According to Sanjeev Anand, the Managing Director of BCR, despite previous challenges faced last year,  the bank is now "back on track” to achieve positive profitability.

"We expect to achieve positive profitability in 2009 despite having exercised utmost conservatism and caution in our provisioning.  History is now behind us,” he said.

Anand also mentioned that bank’s investment in Information Technology has greatly enhanced their operations. 

BCR is owned by Actis, a private equity investor in emerging markets with head offices in London and the government of Rwanda which is the minority shareholder with only 20 percent shares.

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