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Benin: Selected Issues

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  • International Monetary Fund

Abstract

This Selected Issues paper reviews the vulnerability and risks associated with Benin’s banking sector. Banks in Benin show significant vulnerabilities. Although financial soundness indicators do not present immediate stability concern, the quality of banks’ loan portfolio is low and has constrained credit to the private sector. Stress tests confirm that credit risk is of particular concern. Structural impediments are at the root of these risks, including problems with property titles, information asymmetries, and the weak judiciary, which complicates contract enforcement. Structural reforms and a re-calibration of fiscal policies to reduce the government’s lending needs are necessary to mitigate these risks over time.

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  • International Monetary Fund, 2016. "Benin: Selected Issues," IMF Staff Country Reports 2016/007, International Monetary Fund.
    • Handle: RePEc:imf:imfscr:2016/007
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    1. Dehejia, Rajeev & Montgomery, Heather & Morduch, Jonathan, 2012. "Do interest rates matter? Credit demand in the Dhaka slums," Journal of Development Economics, Elsevier, vol. 97(2), pages 437-449.
    2. International Monetary Fund, 2015. "West African Economic and Monetary Union: Selected Issues," IMF Staff Country Reports 2015/101, International Monetary Fund.
    3. Ms. Era Dabla-Norris & Yan Ji & Robert M. Townsend & Ms. Filiz D Unsal, 2015. "Identifying Constraints to Financial Inclusion and Their Impact on GDP and Inequality: A Structural Framework for Policy," IMF Working Papers 2015/022, International Monetary Fund.
    4. Mr. Alexei P Kireyev, 2015. "How to Improve the Effectiveness of Monetary Policy in the West African Economic and Monetary Union," IMF Working Papers 2015/099, International Monetary Fund.
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    Cited by:

    1. Seck, Ousmane, 2017. "Islamic Microfinance Experience in a Secular State: Case of Benin," Policy Papers 2017-5, The Islamic Research and Teaching Institute (IRTI).

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