2018年-IMF国际货币组织全球_The_Gambia_Selected_Issues_40页_1mb

The Gambia: Selected Issues Paper Summary

Core Content

This document provides an analysis of macrofinancial linkages, financial benchmarking, and fiscal stress tests in The Gambia, prepared by the International Monetary Fund (IMF) as part of its periodic consultation with the country. The report highlights the financial sector's vulnerabilities and its interactions with the real and public sectors, and outlines policy recommendations for financial deepening and stability.

Main Points

A. Background

• Macrofinancial analysis is crucial to understanding vulnerabilities in the financial sector and its linkages to other sectors.
• The analysis is based on available data up to December 2017.
• It is a two-way relationship between macroeconomic fundamentals and the financial sector, with vulnerabilities in one affecting the other.
• Sensitivity checks are used to assess the impact of adverse linkages, even if data limitations prevent a full cross-sectoral balance sheet analysis.

B. Overview of Macrofinancial Linkages

• Strong sovereign-bank nexus: Banks have significant exposure to government through investments in government debt and SOEs.
• SOE arrears: The SOE cluster has experienced persistent financial distress, leading to arrears to both the central government and among SOEs themselves.
  • As of November 2017, GAMCEL and the National Food Security Processing and Marketing Corporation each had arrears of around GMD 250 million to the central government.
  • SSHFC, which provides financial services to the real sector and government, has GMD 1.7 billion in non-performing loans, with NAWEC being the largest non-compliant debtor.
• Arrears to SSHFC may require government intervention or an increase in contribution rates, which could impact households.

C. Banking Sector Characteristics and Risks

• Characteristics:
  • Gambian banks have a high proportion of low-risk, high-yield government securities, particularly treasury bills.
  • Real sector credit has stagnated or declined since 2010, and the share of liquid assets (cash, treasuries, claims on other banks) has increased from 40% to 66% of total assets.
  • Corporate-to-government exposure ratio has declined over time, with a long-run average of 100% in 2000-2010.
• Risks:
  • Low operational efficiency is a key issue, with the efficiency ratio (non-interest expense to net interest income) reaching 80% in some years.
  • Capital adequacy ratios are artificially high due to zero-risk-weighted sovereign assets, masking the true risk exposure.
  • Lack of long-term funding limits banks' ability to support infrastructure lending and expand credit to the private sector.

D. Testing Banks' Resilience to Adverse Linkages

• Sensitivity tests were conducted to evaluate the impact of macrofinancial shocks on bank stability.
• Three key scenarios:
  1. Corporate credit rebound to match government exposure (1:1 ratio).
  2. Provisioning of the restructured NAWEC bond at 5%.
  3. Non-zero risk weight on government exposures (20%).
• Combined scenario shows the most severe impact, with the average CAR dropping to 23.7% and the lowest CAR at 5.5%.
• Resilience at the system level is evident, but individual banks face capital issues under certain scenarios.

E. Financial Frictions and Remedial Measures

• Challenges to private sector credit rebound:
  • Incomplete credit data at the Credit Reference Bureau (CRB) hinders informed lending decisions.
  • High lending rates deter some borrowers, especially those in high-risk sectors.
  • Stringent collateral requirements exclude SMEs and other small borrowers.
  • Obstacles to mortgage credit due to low national income and legal provisions favoring debtors.
• Remedial measures:
  • Banks should adjust lending rates, develop longer-term financial instruments, and diversify credit to primary and secondary sectors.
  • Private sector should pursue sectoral reforms and diversification, such as shifting from single-crop agriculture to irrigation-based systems and improving hotel occupancy rates.
  • Government and CBG should:
    • Improve the CRB by ensuring timely and complete information and promoting a private credit bureau.
    • Modify the Mortgage Act and loan contracts to facilitate easier foreclosures and clarify responsibilities.
    • Consider subsidizing SME credit through a specialized fund or credit guarantee schemes.
    • Conduct risk-based thematic reviews of potential bank mergers or exits.
    • Implement differentiated regulatory requirements for microfinance institutions to support their development.

Key Information

• Net arrears between sectors are shown in Figure 1, with government and SOEs having the largest claims.
• Real credit to the private sector has not grown since 2010 and fell in recent years (Figure 2).
• Bank efficiency is low, with non-interest expenses surpassing salary costs.
• Capital adequacy ratios are artificially high, due to zero-risk-weighted sovereign assets.
• T-bill rates have declined rapidly, affecting profitability and bank resilience.
• Fiscal stress tests indicate the central government has assumed contingent liabilities from SOEs.
• Financial deepening is needed to improve private sector credit and bank efficiency.

Conclusion

The Gambia's financial sector is highly dependent on government securities, which has led to low financial intermediation and limited private sector credit. While the sector shows systemic resilience, individual banks face capital and liquidity challenges. Financial frictions, including data gaps, high lending rates, and stringent collateral requirements, are hindering credit expansion. To promote financial stability and deepening, the banking sector, private sector, and government must take coordinated actions, including policy reforms, regulatory adjustments, and institutional improvements.