Benoît de Carbonnieres, Regional Manager, Rawbank

MACIG Connect Series

Rawbank has grown rapidly since it began business in 2002 to become one of the largest banks in DRC and has an active participation with the mining sector.

Rawbank is celebrating its 15th year since it began in DRC in 2002. Can you give me a brief history of Rawbank, including any recent milestones the company has achieved?

We have been operating in the Grand Katanga (formerly Katanga zone) for 10 years and have since become the largest bank in terms of market share operating in DRC with a balance sheet of over $1 billion. The bank started by developing in three main markets: retail, corporate and private banking. The level of banking among the population was very low so Rawbank was interested to develop the retail and corporate market to increase the entrepreneurial spirit of the people and develop the economy. Due to the development of these two markets the private banking market also increased as a different economical class of people was created that wanted a banking product that effectively represented their standard of life. Foreign investments are also important in DRC, so Rawbank has developed the profiles of our employees to include English and Chinese speaking staff to target the clients currently investing in the country. Going forward, the growth strategy of Rawbank is to become the main bank responsible for international investments in DRC.

How important is the mining sector as a client to Rawbank and what role do you see the company playing in the sector in the future?

The mining sector is essential in the development of the Grand Katanga and the eastern region of DRC, meaning it is vital for Rawbank to be present in this field. An estimated over 80% of mining investors are foreign investors so Rawbank has to support this field as best as we can as it is the start of the vertical chain of economic development in both regions.

What is the most significant challenge facing the banking sector at present in DRC?

The internal challenge is the rate of uptake of banking services by the population; today we estimate that only 8-10% of people have a bank account. To encourage people who have been using solely cash for generations to open a bank account and pay bank rates will require a large amount of trust and education into the benefits the bank can offer, including security as well as convenience through the development of online and mobile transactions. The external challenge is more focused on proving the credibility and integrity of our banking system to foreign countries, most importantly the U.S.. Aside from the Congolese Franc, the economy of DRC is supported heavily by the U.S. dollar, and the continued use of the U.S. dollar will require integrity and transparency from the banking sector.

What is Rawbank’s strategy to prove integrity to the international community?

Rawbank is operating at an international standard of compliancy. All day-to-day transactions are followed by a dedicated team and all new customers are thoroughly assessed. Before providing credit to clients, we ensure they are respecting social and environmental standards and that they are conducting business with transparency and integrity. We have refused business to potential customers when we could not be 100% sure these standards were being respected. With regards to SWIFT transactions, we ensure the corresponding bank is paying attention to the subject and recipient of the transactions also.

US economic interest in DRC has declined, and given the country’s intimate relationship with the U.S. dollar and the influx of cash here, how do you see this situation evolving?

More cash in circulation will result in fewer U.S. dollars in the economy. However, we need to increase the amount of US dollars in the economy and decrease the amount of cash in circulation as this will attract more investors. Investors want a reliable currency and U.S. dollars are controlled outside of the country resulting in an increase of transparency and integrity in the banking sector.

Geographically speaking, from where is the majority of investment into DRC coming?

Currently, most mining investors are coming from China as they are consuming the majority of non-ferrous metals found here so it is logical that they also want to invest in production. They are also investing in agriculture here as there are approximately 1.5 billion people in China, and they can either increase the current yield of agriculture in their own country or extend the capacity for production. Africa, including DRC, is one of the best regions for agricultural investments as a high yield can be reached and a large variety of crops can be grown here.

How concerned should the mining industry be in the development of the agricultural sectors and other sectors? 

When financing a mining project, Rawbank pays close attention to the environmental impact of the project as we do not want to contribute to any damage caused to the agricultural potential of the area, even if it is a small-scale potential because communities are dependent on the land and it is important to preserve it for future generations. The majority of mines in DRC have engaged in farming activities close to their sites to cultivate food for employees. This is very important because it demonstrates that the mines are considering the well-being of their employees, but trusts the work they are doing on site; they will take precautions to ensure the agricultural standard of their land.

The 2017 finance law was retroactively implemented in June, and the new mining code is currently being revised. Based on the finance law this year, what expectations do you have for the new mining codede?

The tax environment has to remain stable for five to 15 years, otherwise investors will take their business elsewhere as they cannot be confident in their return on investment. However, mining projects continue to develop, meaning the current level of taxation and the mining codes are adequate. The authorities in DRC do not want a repeat of the situation in Zambia as they understand the importance of reliability and stability for the business environment to flourish. However, a solution still needs to be found regarding VAT repayment.

The recent break-up of the provinces has caused disparity between the wealth in Lubumbashi and the resources in Lualaba. What does that mean from a banking perspective and how do you see that evolving over the next couple of years?

It will be a highly beneficial development for the population because the tax revenue will be distributed better in terms of administration. It would appear that equilibrium will be found between Kolwezi and Lubumbashi as the majority of metals are produced in Lualaba, which has a larger mining potential than the whole of Katanga. This will mean more tax revenues for all the new provinces and a split in the market which hopefully, if the split causes a surge in investment, will increase wealth in the country. The break-up of the provinces requires the re-organization of our banking services and means we will need to have staff in every zone to cover the income from the new provinces. When controlling a small territory compared to a large territory, more time can be dedicated to each area which will generate modernization and the development of infrastructure meaning the break-up of the provinces will be beneficial in the long-term.

What is your long-term vision for Rawbank and how are you developing your service offering to the mining sector based on the trends you see?

To maintain our growth and increase our market share, we are geographically focused on all the regions of DRC, not just the mining provinces. There is a lot of risk involved in the mining sector, and consequently we are developing our services accordingly. We are proposing a new project: plug-and-play banking solutions involving installing a bank on site with air-conditioned offices, secure windows, a safe room etc. We are also trying to improve currency exchange for foreign investors because regulations regarding currency are very strict here and not always easy for our clients to understand. Furthermore, we are ensuring that we are meeting the same standards as international banks in terms of day-to-day services, including online banking applications. For our Chinese clients, we have introduced a new product ‘China Card’ that allows clients to spend money in China.

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