In Rwanda, the Central Bank has released the Monetary Policy and Financial Stability Statement which shows that commercial properties lead the list of sectors with non-performing loans at 19.1%. According to Kasai Ndahiriwe, the Director of the Monetary Policy Department, the highest non-performing loan ratio is a result of the inability of most commercial buildings that could not collect rentals during the COVID19 lockdowns as well as those who lost tenants during and after it.
The non-performing loan ratio increased marginally at the end of 2021 from 4.5% to 4.6% against the 2020 benchmark of 5%, while the outstanding NPLs amount increased 19% from 133 billion Rwandan francs to 158 billion francs. On the other hand, the banking sector saw a 34% increase in provisions for bad debt to 189.5 billion francs in December 2021 from 141.3 billion francs in 2020. The industry’s aggregate net profit however grew by 53.6% to 125 billion francs, with the microfinance sector growing from 5.1 billion francs in 2020 to 8 billion the following year. The insurance sector made a net profit of 63.6 billion francs, an increase from 52.4 billion in the previous year.
Earlier, the growth forecast projected by economists for Rwanda’s 2022 had declined, owing to inflation and unemployment. It was previously expected that the economy will grow by 7% but will most likely hover around 5%.