With an exchange rate policy focused on maintaining a fixed parity with the dollar, the Bank of Djibouti has undergone financial liberalism which allows it to become a regional financial base offering attractive, dynamic and safe services for regional operators. The finance sector also benefits from the added boost through the submarine cable system which guarantees speedy and secure transactions.
Currently, Djibouti has eleven banks serving a population of 800,000.
The Banking sector in Djibouti
Banking in Djibouti plays a vital role in the national economy and employs more than 400 people, representing more than 5% of the GDP. Djibouti’s geographical position and its political and economic stability have allowed the nation to create a vibrant financial sector.
Indeed, attracted by the security and freedom of movement enjoyed by the capital market, new banks are fast lining up to be in the list of approved banks by the Central Bank of Djibouti.
The strict application of regulations and the prudent international standards have enabled the financial sector to have a healthy and reliable banking system, allowing investors the freedom to enjoy capital movement.
In addition to the Central Bank of Djibouti, Djibouti has eleven credit institutions which provide banking services in Djibouti:
Banque pour le Commerce et l'Industrie Mer Rouge(BCIMR)
Banque Indosuez - Red Sea (Bank of Africa)
Commercial Bank International SA (Malaysia).
Saba Islamic Bank (Yemen)
Cak International Bank (Yemen)
Bank Deposit and Credit (Switzerland).
Salaam African Bank held by Somali businessmen.
Dahabshil International Bank (Dahabshil group).
Shoura Bank (Egypt)
Warka Bank (Kuwait)
Exim Bank (Tanzania)
In the coming year, it is expected that two or three additional new banks will have opened shop in Djibouti.
The minimum capital for banks and financial institutions is set at three hundred 300 million DJF, Djibouti Franc, following the promulgation of the new Banking law in 2005. The country now has eleven banks for a population of less than a million inhabitants, with a rate of banking still very low.
In 2010, private sector credit granted by the system recorded an annual increase of 30% from 23% in 2007 in a context of declining interest rates. Foreign assets of the banking system achieved a growth of 27.2% over the past two years, to reach nearly 800 million at the end of 2010.
In addition, any economic actor, resident or non-resident may, forthwith; proceed to open an account and transfer money around the world.
The political and economic stability, and openness to the outside permitted by a telecommunications system infrastructure and the development of Internet use are significant assets available in Djibouti’s regional financial centers.
In addition, local banks are affiliated to the SWIFT network and can perform all their transactions transfer or receive remittances in perfect conditions both on time and securely.
Banks could also specialize in services such as wealth management and investment advice; they would hold the monopoly in the region and could attract many traders of East Africa.
The presence of a freely convertible and stable currency combined with a unique geographical position and banking infrastructure, and a modern and reliable telecommunication makes the financial sector of Djibouti dynamic and attractive. Regional investors and businessmen are welcome in Djibouti. We give all facilities that you need quickly and safely. It is unique in Africa.