An Empirical Review on Competitiveness of Commercial Banks and Economic Development in the Democratic Republic of Congo (DRC)

The economic sector in the Democratic Republic of Congo (DRC) is facing recent developments and is mainly dominated by banks. The financial sector is comprised of more than 17 licensed banks mainly regulated by the Central Bank of Congo. The banking sector is grouped into large, medium and small banks. Trade finance is not widely available through the DRC's commercial banking sector. The DRC's international firms are primarily privately financed due to the high cost of traditional financing sources resulting from persistent political risk. Although they are still rare, established businesses can still obtain trade credit locally. Since the DRC's economy is dollarized, the majority of establishments take either US dollars or Congolese francs. The present empirical research study adopted a mixed research methodology that entailed both qualitative and quantitative techniques. Both techniques are combined to provide a better understanding of the impact of micro-and macro-economic factors on the financial performance of the three largest banks in the DRC including RawBank, Equity Banque Commerciale du Congo (BCDC) and Trust Merchant Bank S.A. (TMB). In terms of total assets, the results showed that Rawbank reported the highest total assets for each year of the period of analysis and the cumulative total assets for the three banks. In terms of trend analysis, the three banks reported a positive increase in their total assets between 2020 and 2021 with Rawbank reporting the highest increase in total assets by 47.5 percent closely followed by BCDC which reported a 46.8 percent increase. In terms of thematic classification, the results identified two major themes, micro-economic and macro-economic factors that directly affected the competitiveness and economic development in DRC.