Cameroon is generally and rightly regarded as a poorly governed country. President Paul Biya, who has been in power since 1982, leads the country autocratically, is in permanent conflict with part of the Anglophone population and is unable to lead the country, which is blessed with so many human and natural resources, into dynamic growth.

Celestin Guela, CEO of Afriland First Bank, explains in an interview how it was nevertheless possible to build what is now Cameroon’s largest and most successful bank from virtually nothing in this environment.


Afriland First Bank was initially founded in 1987 under the name CCEI Bank by the Cameroonian entrepreneur Paul Fokam and several other investors. The founding capital at the time was 450,000 euros and CCEI Bank was by far the smallest institution in an environment characterized almost exclusively by branches of major French and South African banks.

36 years later, Afriland First Bank has become the largest bank in Cameroon with a 20% market share of savings deposits. As at December 31, 2022, the balance sheet total was EUR 2.65 billion, customer deposits amounted to EUR 2.09 billion and loans extended amounted to EUR 1.52 billion. With equity of 137.5 billion euros, the profit amounted to 31.5 million euros. We talk to the bank’s CEO about this “revolution” in the Cameroonian banking sector.

Question: What motivated the founders of AFriland First Bank to launch a new bank in an environment characterized by a deep economic crisis and a loss of trust between economic players and the banking sector?

Answer: That is exact. In the 1980s, many African economies were confronted with a crisis in commodity prices, widespread inflation and an extensive banking crisis. It was important to restore confidence and rehabilitate the banks as the engine of economic progress. The branches of the large foreign banks had other concerns than offering customers locally adapted products. In this context, Dr. Fokam and his colleagues have taken the risk of offering African solutions to African problems in the service of the national economy. In particular, this also involved mobilizing local savings by offering appropriate products that were flexible and attractive. In short, there was a revolution in the way banks were run and customer confidence in banks returned.

Question: Today AFriland First Bank is the largest bank in Cameroon with a market share of 18% – 20%. Afriland First Bank is also one of the most profitable banks in Central Africa. What are the main factors that explain this success?

Answer: First of all, it has to be said that the bank was not always as profitable as it is today. The results that have now been achieved are the result of many years of hard work. In my view, the three key success factors are as follows.

  • Firstly, we make sure that we always maintain significantly more liquidity than we extend loans. This does not necessarily increase the bank’s profitability, but unlike almost all of our competitors in Cameroon over the last 35 years, it has prevented us from running into a liquidity bottleneck (bank run) and needing external help.
  • Secondly, from the very beginning we have been looking after the business segment of small and medium-sized entrepreneurs and have given them access to loans, which until now have been difficult to obtain from banks. Although this was also accompanied by increased default risks, it was compensated for by corresponding profits. Today, almost all banks in Cameroon cater to this clientele, which was largely not the case before Afriland First Bank was founded. It must be said, however, that we have also acquired many major customers in the meantime and are underwriting a considerable volume of government bonds from Cameroon and other Central African countries. The financial market in Cameroon has developed to such an extent that we are able to finance projects in the order of EUR 100 – 200 million with local bank consortia without having to resort to foreign financial institutions.
  • And then we have always excelled with innovations. For example, we initiated the second largest microfinance network in Cameroon, with which we have maintained a large number of business relationships and which has made a significant contribution to “financial inclusion” in Cameroon. 30 years later, the effect of these rural cooperative banks cannot be overestimated.

We were the first to introduce Flash Cash, a secure means of payment that can be redeemed anywhere in Cameroon and Central Africa. In addition, the Icard, a kind of electronic wallet, should be mentioned in particular, which unfortunately was not accepted by the central bank for reasons that are not entirely clear. We were and are also the pioneers in “Islamic financing” in Cameroon. We are the only ones who finance pilgrimages to Mecca on a large scale.

Question: Today, 60% of the Cameroonian banking market is controlled by banks that come either from Cameroon itself or from West and Central Africa. How do you explain this high market share?

Answer: These are partly the reasons I have already given for the success of Afriland First Bank. African banks are often closer to their customers, are often more flexible and often have a somewhat greater appetite for risk than the credit committees of multinational institutions that are located far outside Cameroon. What’s more, banking supervision in Cameroon works perfectly well. In this way, banks that get into difficulties are absorbed in good time or taken out of the market. This creates trust.

Question: Now Afriland First Bank prides itself, as you said, on offering African solutions to African problems. Nevertheless, they have had to rely on external support several times in their long history. Is that a contradiction?

Answer: We have never been directly dependent on external support. But there was support without us becoming “dependent”.

The Dutch development bank FMO and DEG-Deutsche Investitions- und Entwicklungsgesellschaft invested in our capital and gave us loans as soon as CCEI-Bank was founded. Many years later, DEG again participated in the financing of Afriland First Bank with an equity-like loan. These financings were not only important for the “money”, but they also gave us a lot of credibility in the market and with the banking supervisory authorities and enabled us to expand our financing business and our capacity building. I know that there were long discussions in The Hague and Cologne about whether to get involved in financing a then still small and unknown bank in Africa, but ultimately FMO, DEG and later IFC (2013) and Proparco (2022) did important groundwork in terms of development policy for the further development of the Cameroonian banking sector.

But back to your actual question. What can foreign support do? In fact, for a while we were too fixated on finding our own original solutions for everything. This applied to IT, but also to a modern information processing system, where we struggled for many years with dozens of Excel spreadsheets, some of which provided contradictory information to our investors and lenders. We were able to remedy this with the help of a technical assistance program from DEG, so that we are now in a position to call up all the necessary information on a daily basis and pass it on if necessary. This is a real competitive advantage and was also important for banking supervision. I would like to emphasize that DEG’s support was very important with regard to our risk management, our internal governance and our information processing system.

As a result, I can say that it is of course important to start by tackling things on your own and creating the core framework of an institution. However, external support can and must be used to further expand this core structure. However, this external support will only work if it can rely on the cooperation of a motivated and qualified “internal” team.

Question: What are the next big challenges facing Afriland First Bank? What innovations will you surprise your customers with?

Answer: Basically, the idea that guides all our activities is how we can satisfy customer needs. We are working on two complementary challenges. It’s about being close to customers and mastering the digital transformation at the same time. Afriland First Bank has 60 branches in Cameroon. We want Cameroonians to have access to our products at any time, wherever they are and via any channel (phone, computer, tablet, but also the store). That is why we are expanding our network with medium-sized branches and our electronic banking portal “SARA” as far and as fast as possible. Finally, I would like to say that our biggest challenge is to attract capable employees and keep them at our bank in the long term.

Autor

  • Celestin Guela

    Celestin Guela, CEO Afriland First Bank Cameroon, 52 years old, married to a cardiologist, 4 children. Adopted son of bank founder Paul Fokam, graduated in civil engineering and architecture (University of Lille in Belgium). He also holds degrees in law, economics and business management from the University of Sorbonne in Paris. In 22 years at Afriland First Bank, Celestin Guela has managed many areas of the bank, from project manager to head of department and risk director.

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The success story of an African bank in a stagnating and poorly governed country (Cameroon).

Celestin Guela


[wpml-string context="pb-bioinfo" name="info-4"]Celestin Guela, CEO Afriland First Bank Kamerun, 52 Jahre, verheiratet mit einer Kardiolgin, 4 Kinder. Adoptivsohn des Bankgründers Paul Fokam, graduierter Bauingenieur und Architekt (Universität Lille in Belgien). Außerdem Abschlüsse in Recht, Ökonomie und Unternehmensführung an der Universität Sorbonne in Paris. Celestin Guela hat bei der Afriland First Bank innerhalb von 22 Jahren vom Projektmanager bis zum Abteilungsleiter und Risikovorstand viele Bereiche der Bank geführt.[/wpml-string]


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