- April 20, 2022
- Posted by: admin
- Category: Current News
MEFMI, jointly with the International Monetary Fund (IMF), conducted a virtual training on Credit Risk Assessment for Loan Guarantees from 21 to 25 March 2022. The workshop aimed to raise awareness on the available tools and frameworks for assessing and managing credit risks arising from loan guarantees. The training was organised against the background that most countries in the MEFMI region do not have sound frameworks for managing guaranteed debt.
The workshop was attended by 57 officials, comprising 33 females and 24 males, from 13 MEFMI member countries, namely Angola, Botswana, Eswatini, Kenya, Lesotho, Malawi, Mozambique, Namibia, Rwanda, Tanzania, Uganda, Zambia and Zimbabwe. The participants were drawn from the Ministries of Finance, Economic Planning and Development; Central Banks; and Offices of the Auditor General.
Participants were introduced to the various approaches for assessing credit risk, including a practical application of the credit risk scoring method. The training programme covered the following topics: introduction to contingent liabilities; legal and institutional frameworks for managing loan guarantees; fiscal risk and institutional arrangements for loan guarantees; credit risk scoring model; and introduction to the IMF guarantees management toolkits. Further, to assess whether the concepts taught had been grasped, participants were required to apply the simple credit scoring model to assess the credit risk of a selected entity from their country and thereafter make a presentation of the results.
The workshop set a foundation for member countries to develop robust frameworks for managing loan guarantees. MEFMI plans to further support countries in this area by rolling out Guidelines for managing loan guarantees currently under development with the support of the Financial Sector Deepening (FSD) Africa.
The workshop was facilitated by Messrs Mkhulu Maseko (a MEFMI Consultant from the National Treasury of South Africa), Sanga Sangarabalan, Juan Carlos Vilanova, Fritz Bachmair, Francis Chapfuwa and Ms Amanda Sayegh (all representing the IMF) and Ms Josephine Tito of the MEFMI Secretariat.