Angola Granting Credit In The Real Sector Of The Economy

• Published date: 28 April 2022
• Subject Matter: Real Estate and Construction, Strategy, Construction & Planning, Real Estate, Economic Analysis
• Law Firm: PLMJ
• Author: Mr Gonçalo Dos Reis Martins, Renata Valenti and Joana Marques Dos Reis

The new Notice establishes (i) the terms and conditions applicable to the this type of credit, (ii) the minimum requirements in terms of number and total value and (iii) the treatment in the calculation of the reserve requirements.

Angolan Central Bank (Banco Nacional de Angola, "BNA") recently published Notice 10/22 of 6 April to update the scope of application of Notice 10/20 of 3 April on the granting credit to the real sector of the economy. The new Notice establishes (i) the terms and conditions applicable to the this type of credit, (ii) the minimum requirements in terms of number and total value and (iii) the treatment in the calculation of the reserve requirements.

The illustrative list of essential goods to which the Notice applies underwent minor changes and now includes bee-keeping, pastry and bakery goods, wheat crops and derivatives, and fertilisers and soil correction materials. It no longer mentions cement, clinker, honey and paint for construction.

The Notice provides for the following types of credit: (i) medium-long term credit for investment, including to buy machinery and equipment, which must have as its maximum term the payback period of the investment and may include financing with real guarantees and leasing; (ii) short-term credit to buy raw materials and other inputs from local suppliers in the domestic market, which must be granted for the maximum estimated period between its acquisition and the sale or payment by the buyer of the finished product; and (iii) credit granted as factoring.

Access to credit is now limited to bank customers that meet the following requirements: (i) they must be a company incorporated under the law; (ii) they must have organised accounts and accounts certified by an accountant or expert accountant registered with the OCPCA; (iii) they must have their tax situation in order; and (iv) they must have proven experience in the activity they carry on and for which they are applying for credit.

One of the main changes introduced by the Notice concerns the total cost of the credit, which covers the interest rate and commissions. This now varies according to the type of credit, as follows: in investment credit, it cannot exceed 7.5% per year, and in credit to buy raw materials, inputs and factoring, it cannot exceed 10% per year.

Another of the main changes in the Notice was in the context of the minimum requirements of the number of credits to be granted by each financial banking institution ("Commercial...