(Business in Cameroon) – The Bank of Central African States (Beac) made a new liquidity offer to commercial banks on August 20, 2024. This time, the central bank is offering a significant CFA250 billion, marking the largest injection since these operations resumed in early June 2024, after a suspension of over a year.
This increase in liquidity comes just a day after a failed attempt by Beac to withdraw CFA50 billion from CEMAC’s commercial banks through the issuance of securities. On August 19, 2024, the central bank offered securities worth CFA50 billion at an interest rate of 3.5%, but the offer failed due to a lack of subscriptions.
This failed operation highlights the ongoing need for cash among the region’s commercial banks, which have been eagerly taking up Beac’s liquidity offers since the operations resumed in June 2024. This strong demand for liquidity follows several months of austerity measures from the central bank, which included gradual hikes in key interest rates, suspensions of liquidity injections, increased liquidity absorption operations, and the issuance of Beac bonds.
According to Beac, these austerity measures were designed to tighten banking conditions and curb the 20% inflation rate, believed to be driven by monetary factors. However, with inflationary pressures easing, Beac has been steadily increasing the volume of liquidity it provides to banks, aiming to ease the financial pressure on them.
