"The Angolan banking sector will face numerous challenges as it develops in the coming years, but asset quality remains low and public indebtedness is increasing, leaving little room for loans to the private sector," reads a Fitch analysis of the Angolan financial sector.
According to the analysis made by this consultancy held by the same owners of the Fitch rating agency, sent to clients and to which Lusa had access, "in this context and with a moderate pace of depreciation of the kwanza in the next quarters, the growth of loans should slow down during the next few years before starting to rise again" towards the end of this decade.
In the future, they add, "the sector should see changes in structure as the government is planning to privatize several entities, making consolidation more likely among small institutions that are already struggling to meet regulatory standards".
Despite the difficulties, Fitch Solutions says that "the services and banking sector in Angola offers considerable potential for growth", recalling that the penetration rate of financial services outside the banking sector is low and that the government has "a strong interest in developing financial inclusiveness and is carrying out a series of reforms to make the market more accessible and ensure more liquidity".
Only, they conclude, "average income levels are low and informal employment with high levels will continue to exclude many potential citizens from being customers of the insurance and asset management sectors".
