Decision No. 061-03-2011 on the Eligibility Criteria for Bank Loans Granted to Decentralized Financial Systems in Support of BCEAO Refinancing

THE MONETARY POLICY COMMITTEE,
Having regard to Decision No. 397-12-2010 establishing the rules, instruments and procedures for implementing the monetary and credit policy of the Central Bank of West African States (BCEAO), particularly Articles 44 to 54, DECIDES

Article 1: Subject Matter
This Decision defines the conditions under which credit facilities granted by credit institutions to Decentralized Financial Systems (DFS) may be admitted as refinancing collateral for the Central Bank of West African States (BCEAO or Central Bank).

Article 2: Claims on DFS Admitted as Refinancing Collateral
To be eligible, bank loans must be granted to microfinance institutions subject to the supervision of the Central Bank and the Banking Commission of the West African Monetary Union (WAMU), pursuant to Article 44 of the law regulating DFS.

Article 3: Criteria to be Met
The microfinance institutions referred to in Article 2 of this Decision must, furthermore, comply with the prudential rules applicable to decentralized financial systems in Member States of WAMU, particularly the following ratios:
– the capitalization or solvency standard, determined by the ratio of equity to total assets; – the liquidity ratio, which measures the institution's ability to meet its due liabilities; – the lending limitation ratio for directors, staff, and related parties.

Avenue Abdoulaye FADIGA
BP 3108 – Dakar – Senegal
Tel. (221) 33 839 05 00 / Fax. (221) 33 823 93 35 www.bceao.int

DECISION NO. 061-03-2011 ON THE ELIGIBILITY CRITERIA FOR BANK LOANS GRANTED TO DECENTRALIZED FINANCIAL SYSTEMS IN SUPPORT OF BCEAO REFINANCING

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Article 4: Entry into Force
This Decision shall enter into force on March 2, 2011, and shall be published where necessary.
Done at Dakar, on March 2, 2011

For the Monetary Policy Committee,
The President
Jean-Baptiste COMPAORE