The Banque pour le Commerce et l’Industrie – Mer Rouge (BCIMR) a subsidiary of the French bank BRED, officially celebrated the opening of its representative office in Ethiopia. BCIMR opened the first branch in Djibouti 1954. Djiboutian government and BRED own BCIMR. From its base in Djibouti, the BCIMR has played a significant part in over fifty years of economic development of the region. Oliver Klein CEO of BRED talked to Capital about the bank’s future plans. Excerpts;
Capital: Please tell us why you are here. What your bank is planning to do here in Ethiopia.
Oliver Klein: Well first we are very happy to be in Ethiopia. Ethiopia is a really big country and is developing very fast: it’s amazing. To introduce the BRED group to Ethiopians themselves, let’s say that we are a member of the BPCE Federation, which is the second banking group in France. We are its biggest Regional Retail Bank. We operate in France in retail banking, and large corporate banking. Together with traditional banking activities, we have a trading floor, asset management and life insurance companies. Moreover, we operate banks in several foreign countries including Djibouti. In Djibouti, with the Djiboutian government, we are shareholders of “Banque pour le Commerce et l’Industrie – Mer Rouge” (BCIMR). It is the main bank in Djibouti with a 50 percent market share, a major player when it comes to financing the Djiboutian economy. Our goal is to operate there as we do in France, and contribute to developping the economy through collecting and lending money from and to individuals, small businesses and bigger corporations. That is also the reason why we are here and why we open a representative office officially here in Addis.
But we are not only in the East Horn of Africa, we are also in South-East Asia. We have banks in Laos and Cambodia, and we will also start to operate in Myanmar – which is a great country. We have IT operations in Bangkok. All the IT for our foreign banks is operated in Bangkok. We also have banking subsidiaries in the pacific area. We are in New Caledonia, with a bank we hold with the Caledonian Authorities, in Vanuatu and in the Fiji islands. In each country we go, we do our best to serve local development. It means financing projects as we collect deposits to be able to do so.
Capital: The banking sector is not open for foreigners in Ethiopia, so what do you plan to do in Ethiopia?
Klein: Yes, we know that the banking sector is not open yet. So here in Ethiopia, our BCI MR representative office aims at facilitating trade and business between Djibouti and Ethiopia first. We hope our representative office can be an extra bond between the two countries that already benefit from positive outcomes of their strong relationship. It will facilitate the coming business. We also believe we can help in developing some business between France and Ethiopia and more globally between Ethiopia and Europe. A lot of people here were also asking questions about France, or Europe, and what we can do for them. We can first have some business with local banks. Today, for instance, we met with some of the most important banks in Ethiopia about correspondent banking in order to offer money transfer services. We can also deliver some letters of credit to better facilitate trade.
Capital: Can you actually open a letter of credit in your bank now?
Klein: We can open letters of credit in BCIMR in relation with Ethiopian banks. So that is what we can try to do but I saw tonight, and thanks to our contacts, that they are waiting for something. All the businessmen here are waiting something from us, and we will try hard to be the ones that will bring something extra and help them. And maybe in the future, I don’t know when, if Ethiopia wants to allow some foreign banks to come here, we will be delighted to seriously study this possibility. Anyway, we need some time to know your country. We need some time to know the people, and to learn more about how everything works here.
For example, in Laos, we are a shareholder of the major state-owned bank. We decided to open up a new bank together: we operate that bank and it complements the existing services of our partner.
Capital: Do you have any plans to open up in other African countries?
Klein: No as BPCE already has operations in North and Central Africa, BRED subsidiaries develop in East Africa, specifically on the Horn of Africa. So we have no intention regarding other areas in Africa.
Capital: Are you planning to give guarantee for SME’s through local banks?
Klein: We will see. In France and in the other countries where we operate, we really specialize on SME’s. That’s usually this SME banking know-how that convinced the countries that granted us the right to operate locally.
Let me tell you that last June, for example, we organized a ‘Day of Djibouti’ in Paris where we were very happy to host the Djiboutian Minister of Finance, the Djiboutian Central Bank Governor, the CEO of the harbor of Djibouti, and many others from the Djiboutian French Chamber of Commerce. And we also attracted a lot of French industries and businesses to let them know about what is going on in the Horn of Africa. And since the French businesses were really interested, we are now organizing a trip to accompany them to Djibouti and for sure to Ethiopia at the same time to see how it goes and why Ethiopia and Djibouti are very interesting parts of the world in terms of opportunities.
Capital: Do you have any specific projects that are ongoing in Djibouti or Ethiopia?
Klein: Well, we took part in the financing of the railway between Addis and Djibouti. We pre-financed the electricity connection between Djibouti and Ethiopia. We have also financed the project of connecting Ethiopia, through Djibouti Telecom and the cable that is laid out between Djibouti and Addis. And we have also financed a lot of other Djibouti Telecom projects for that.
We are financing the transit business by Ethiopia through Djibouti. Also, currently we are studying some projects including protracts of touristic programs: tourists traveling to Ethiopia would also go visit Djibouti. We are studying these projects and we will probably finance them.
Capital: Djibouti Telecom is trying to use Ethiopian Telecom as a hub for their region, are you planning to finance that?
Klein: Yes, I think we are the main bank for Djibouti telecom.
Capital: Any final comments?
Klein: This is my first trip to Ethiopia, and I am really impressed by what I see. Everywhere you go, you see construction and so many new buildings: you can feel Ethiopia is really booming right now. We have heard about a lot of projects, in Djibouti as well as in Ethiopia. We are happy to be a part of it.
Ethiopia has something of a magic place for French people. Your ancient and rich history, your proud traditions: somehow, these generate admiration. For sure, a lot of European people would love to visit Ethiopia. Your country has a strong image, so as Ethiopia opens up more and more, I think tourism will peak up fast. And, no doubt, it has been a real pleasure for me to be here.