Togo banks post record reserves, far above BCEAO requirements

Banking

Monday, 08 September 2025 13:58

Togo banks post record reserves, far above BCEAO requirements

Highlights:

• Togo’s banks held reserves of 157.6 bln CFA francs in July–Aug, 220% of BCEAO requirements.
• Surplus reflects post-Covid prudential management but raises concerns over SME financing.
• Togo ranks among the most prudent in the region; Senegal leads, Niger trails.

Togo’s banking sector has built up a record surplus of reserves, according to the Central Bank of West African States (BCEAO), underscoring strong liquidity management but also raising questions about lending to the private sector.

Banks in the country held 157.6 billion CFA francs ($255 million) in reserves in July–August 2025, more than double the regulatory requirement of 71.5 billion CFA francs ($116 million). The net surplus reached 86.1 billion CFA francs ($140 million), with a coverage ratio of 220%.

The trend reflects years of gradual strengthening since the Covid-19 pandemic. The net balance was only 2.3 billion CFA francs ($3.7 million) in November 2023 but climbed steadily through 2024, crossing 80 billion CFA francs in the second half of 2025.

Analysts say the buildup shows banks’ capacity to absorb shocks while meeting BCEAO prudential rules. But they note that surplus liquidity could be redirected to expand lending to small and medium-sized enterprises, which still face financing barriers.

In regional comparison, Togo’s coverage ratio of 220% is among the highest in the West African Monetary Union. Senegal leads with 315%, while Niger lags near the minimum at 115%.

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REFORMS OVERVIEW

STARTING A BUSINESS (more info)

At the fifteenth position, worldwide, and first in Africa, under the Starting a Business index of the 2020 Doing Business ranking, Togo sustains its reformative dynamics with more reforms….

ENFORCING CONTRACTS (more info)

Compared to some years ago when it was one of the lowest rankers under the Doing Business’ Enforcing Contracts indicator, Togo, leveraging many efforts to improve its business climate, was able to jump significantly on the index in the recent years... .

CONTRACT EXECUTION (more info)

Creation of special chambers of commerce for small debts • Creation of chambers of commerce at the Court of Appeal • Civil and commercial cases now handled by distinct clerks • Establishment of commercial courts in Lomé and Kara • Lawyers and bailiffs now have access to the FORSETI COMMERCIAL platform • A maximum period of 100 days was fixed to settle a commercial dispute .

TRADING ACROSS BORDERS (more info)

In comparison to previous years,Togo has significantly improved its ranking under the“Trading across borders” indicator by adopting multiple reforms that focus mainly on the digitization and reduction in delays, for import and export procedures related to import and export.

In comparison to previous years, Togo has significantly improved its ranking on the “Trading across borders” index by adopting multiple reforms that focus mainly on the digitalization and reduction in delays, for import and export procedures related to import and export.

CONSTRUCTION PERMIT (more info)

After moving from the 133rd to 127th place under the 2020 Doing Business’ construction permit index, Togo intends to reiterate this feat in the coming edition of the global ranking. To this end, it has introduced this year multiple reforms.

GETTING ELECTRICITY (more info)

Over the past two years, Togo’s ranking under the Doing Business’ Getting electricity and water indicator has increased consistently. Owing this performance to multiple reforms aimed at making it easier for businesses to access power and water, Lomé plans to introduce even more reforms this year to keep up its improvements.

REGISTERING A PROPERTY (more info)

Out of all the 'Doing Business’ indicators, Property Registration is where Togo has improved the most since 2018. Indeed, after spending years in the lowest part of this ranking, the country now seeks to beat Rwanda which is the best performer on this index in Africa. To do so, Lomé has been introducing many reforms, with the latest batch implemented this year.

PUBLIC PROCUREMENT (more info)

From professionalization to digitization, through legislative regulations, Togo’s public procurement framework is constantly being modernized. Several reforms have been implemented to improve the sector much to the benefit of the private sector, which is the focus of the National Development Plan.

PAYING TAXES AND DUTIES (more info)

To improve its business environment, Togo introduced some important reforms related to the payment of tax and duties. From the replacement of some taxes to the cancellation of others through exemptions, the country has only one objective: offer the most attractive tax framework to investors and economic operators. To achieve this, the authorities relied on digitization.