Rwanda

Rwanda's financial system is small and bank-dominated. Banks held FRW 11.6tn of the FRW 17.5tn in financial sector assets at end-June 2026, with total financial sector assets equal to about 68% of GDP. Supervised banks comprise nine commercial banks, including Bank of Kigali, BPR Bank Rwanda, I&M Bank Rwanda, Equity Bank Rwanda and Ecobank Rwanda, plus the Development Bank of Rwanda and the Zigama CSS cooperative bank. Five banks are designated domestic systemically important and must hold higher loss-absorbency buffers.

Commercial banks account for about FRW 9.2tn of assets and specialised banks for FRW 2.4tn. Deposits totalled FRW 7.1tn in June 2026 and remain concentrated in short maturities. Bank lending grew 22% year on year to FRW 6.05tn, faster than nominal GDP for four consecutive quarters. Credit is concentrated in construction (18.4% of loans), households (15.0%), trade (14.1%) and manufacturing (13.5%), and large exposures made up 36.1% of total loans in March 2026.

Prudential buffers are strong. The banking sector capital adequacy ratio was 22.0% in June 2026, against a 15% minimum, and the leverage ratio stood at 12.4% in December 2025, double the 6% requirement. Liquidity coverage ratios remain well above 100%. Asset quality weakened slightly, with the NPL ratio rising to 3.0% in June 2026 from 2.6% a year earlier because of downgrades of a few large clients. Profitability is high: return on assets was 4.6% and return on equity 21.1%.

The main risks are macroeconomic. Inflation rose to 14.5% in July 2026, above the 2–8% target range, driven by energy and food prices linked to the Middle East conflict, prompting 200bp of policy rate increases during 2026. The franc depreciated only 0.87% against the dollar in the first half of 2026, helped by foreign exchange reforms and stronger exports. The National Bank of Rwanda is monitoring credit concentration, rapid loan growth and operational and cyber risks from digital payments.