FINANCIAL INSTITUTIONS: Rwanda joins EADB board

Rwanda has already domesticated the East African Development Bank Act in the Rwandan laws Rwanda has taken her seat on the board of directors of the East African Development Bank (EADB), according to the statement on the bank. The statement says Rwanda will now take her seat on the board of directors of EADB more than a year after its formal admission into the East African Community (EAC). John Rwagombwa, the Permanent Secretary in Rwanda’s Ministry of Finance and Economic planning attended the EADB’s 215th Board of Directors meeting held in Kampala last month. Rwangombwa who is also Secretary to the Treasury was in August this year appointed to the EADB board by the Minister of Finance and Economic Planning, James Musoni. The statement says that the country has already domesticated the EADB Act in the Rwandan laws. “The Board noted with appreciation the support given by the Republic of Rwanda to the integration of the East African Community,” the statement reads in part. On February 23, 2008, the EADB governing council resolved to admit Rwanda as a class A member subject to fulfillment of share capital subscription requirements. Class A members of the EADB are member countries, while Class B members are institutions. Last year EADB recorded a loss of $8.8m (Rwf4.8b) compared to a net profit of $4.6m (Rwf2.5b) in 2006. The bank posted an operating profit before provisions of $11.7m (Rwf6.4b). The decline in performance is attributed to an increase in impairment losses on loans and advances. However the board is confident of the bank’s position in the market. “The bank is adequately capitalised and has a comfortable liquidity position well above the minimum required as per its liquidity policy. The board is therefore confident of the bank’s ability to continue meeting its obligations as and when they fall due,” the statement continues. The bank clarified that it has never been denied any loan by the African Development Bank (AfDB) as the recent media reports had stated. In the statement Mukaila Ojelade, AfDB country representative to Uganda, is reported to have confirmed that EADB was not denied a loan by the AfDB. Ojelade is a also board member of EADB. The board further emphasised that the Bank’s lending policy is based on the viability of projects, regardless of the affiliations of the sponsors. The Bank does not finance projects based on political affiliations. “The Bank takes full cognisance of the challenges it has to surmount regarding the economic environment in its Member States, its operational efficiency, and the expectations of the business community,” the statement continues. To address these challenges the Bank is taking a variety of measures aimed at improving the quality of its portfolio. The measures include a careful screening of the quality of the projects entering the bank’s portfolio, strengthening risk management and control, and enhancing project supervision and debt collection. Ends

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FINANCIAL INSTITUTIONS: Rwanda joins EADB board