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Togo: Credit Unions Law Replaced

(June 3, 2011) The Parliament of Togo adopted a new Credit Unions Act on May 10, 2011. It replaces Law No. 95-014 of July 14, 1995. The new Act establishes a single licensing regime and provides for the reinforcement of prudential ratios (i.e., ratios on liquidity, free capital, and capital adequacy, monitored to determine a credit institution's financial stability; see, e.g., Prudential Ratios, BUSINESSDICTIONARY.COM (last visited May 31, 2011)). It also newly obligates credit unions that have reached a certain level of financial commitment, as defined under the Act, to certify their accounts and introduces monitoring and supervision of these credit unions by the Central Bank of West African States (BCEAO). (Albert Atangana, New Credit Unions Act, TNS ONLINE (May 27, 2011), International Bureau of Fiscal Documentation (IBFD) online subscription database.)

According to 2009 data, Togo had 73 credit unions with nearly 875,000 members, a penetration rate of 26% (calculated by dividing the total number of reported members by the economically active population). The credit unions held almost $150 million in savings and had issued about $125 million in loans. (Togo: National Credit Union Data (2009), World Council of Credit Unions website (last visited May 31, 2011).)