NATIONAL NEWS
MONROVIA – President Joseph Nyuma Boakai has warned that Liberia’s persistent non-performing loan crisis is undermining confidence in the country’s financial system and making it harder for businesses, farmers, entrepreneurs and ordinary Liberians to access affordable credit.
By: Moses David Tinnie
Speaking Thursday at the National Conference on the Resolution of Non-Performing Loans in Liberia’s Financial Sector, President Boakai said the problem must no longer be treated as an issue affecting only commercial banks, stressing that its consequences extend across the economy and directly affect job creation and private-sector growth.
Non-performing loans remain one of the significant structural weaknesses in Liberia’s banking sector, with the level of bad loans exceeding the Central Bank of Liberia’s regulatory threshold of 10 percent for several years.
President Boakai said when loans are not repaid, money that should be circulating through the economy becomes tied up, forcing banks to become more cautious and making credit more difficult and expensive to obtain.
“For a system to work, there must be confidence and responsibility on both sides,” President Boakai said. He stressed that banks have a responsibility to lend prudently and properly assess borrowers, while borrowers must also recognize that loan obligations are contractual commitments that must be repaid.
The President argued that Liberia cannot achieve the objectives of the Government’s ARREST Agenda for Inclusive Development without a healthy financial system capable of providing sustainable financing for productive activities.
Boakai said expanding opportunities for young people and women, strengthening agriculture and food security, improving infrastructure, creating jobs and growing Liberian-owned businesses all depend heavily on access to credit.
President Boakai also pointed to deeper weaknesses behind the bad-loan problem, including shortcomings in credit assessment and risk management, gaps in credit information, difficulties enforcing collateral, weaknesses in legal and judicial processes, and concerns about financial discipline and repayment practices.
He insisted that contracts must have meaning and collateral must be enforceable if confidence in the financial system is to be restored.
Calling for a coordinated national response, the President urged the Central Bank, commercial banks, borrowers, Legislature, Judiciary, Executive Branch, private sector and development partners to take responsibility for addressing the crisis.
He called for stronger credit-reporting systems, improved land administration and collateral registration, greater use of technology, responsible digital financial services and a stronger insolvency framework to prevent bad loans from continuing to accumulate.
President Boakai challenged participants to ensure that the conference does not become another forum for prolonged discussions and studies without measurable action.
The President said Liberia has an opportunity to build a financial system in which responsible borrowers can obtain credit, lenders can have confidence that legitimate obligations will be honored, and farmers, manufacturers, entrepreneurs, women and young people can secure capital to expand businesses and create jobs.
He declared the National Conference on the Resolution of Non-Performing Loans officially open, urging stakeholders to move from discussion to implementation in strengthening Liberia’s financial sector and promoting inclusive economic growth.
The conference is expected to assess the scale and causes of non-performing loans, review regulatory and legal frameworks, strengthen credit infrastructure, improve debt recovery and collateral enforcement, and draw lessons from international experiences.
