BEAC (Bank of Central African States)
The central bank shared by the six CEMAC member states, headquartered in Yaoundé, which issues the Central African CFA franc (XAF) and enforces the zone's exchange regulations.
The BEAC (Bank of Central African States) is the common central bank of the six CEMAC (Central African Economic and Monetary Community) states, based in Yaoundé, which issues the Central African CFA franc (XAF) and enforces the zone's exchange regulations. On December 23, 2016, in Yaoundé, an extraordinary summit of CEMAC heads of state ruled out any change to the CFA franc's parity, even as the oil price collapse had drained the zone's foreign exchange reserves. The Bank of Central African States was the one that had to hold that line. Headquartered in Yaoundé, it is the issuing bank of the six members of the Central African Economic and Monetary Community: Cameroon, Central African Republic, Congo, Gabon, Equatorial Guinea and Chad. It issues the Central African CFA franc (code XAF), separate from the West African one, runs the common monetary policy and holds the foreign exchange reserves, part of which remains deposited in the operations account opened with the French Treasury. Banking supervision falls to COBAC, the Central African Banking Commission, which operates alongside it. For an underwriter, the BEAC is first of all the authority that enforces the 2018 exchange regulations. Its doctrine since the 2016 crisis: defend the parity through discipline on hard currency rather than through a rate adjustment. In practice, outward transfers are checked document by document, export proceeds must be repatriated, and residents' foreign currency accounts are restricted. Exchange rate risk in the strict sense stays low, since the peg to the euro holds. Transfer risk, on the other hand, is measured in delays: a payment that is legally authorized can wait for weeks because the commercial bank has no hard currency on hand. Practitioners separate that delay, which may fall within a CPRI (credit and political risk insurance) policy's waiting period, from a formal refusal. An oil zone whose reserves track the price of a barrel does not read like WAEMU (West African Economic and Monetary Union), even under the same currency name.
A Gabonese subsidiary of a French group wants to upstream a dividend to Paris: its bank in Libreville demands the full file required by the exchange regulations before executing, then waits for hard currency. The CPRI (credit and political risk insurance) underwriter notes the gap between that execution delay and a blockage ordered by the state.
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