CEMAC Banking Revolution: A Legal and Practical Analysis of COBAC’s Forthcoming Regulations

By Banyong Fonyam Jonie Jr., Managing Partner – Fonyam and Partners Law Firm

Introduction

The CEMAC region’s banking sector is on the brink of a significant transformation. Following the COBAC stakeholder seminar in Libreville, Gabon, new prudential regulations are being introduced to strengthen the region’s financial system through higher capital requirements and enhanced credit discipline.

These changes are not optional for stakeholders—they are essential for ensuring financial resilience and compliance in an evolving economic landscape.

1. Why the Reforms Now? Understanding the Drivers

COBAC’s upcoming regulations respond to the increasing complexity of the regional and global financial environment. Their core objectives include:

• Systemic Resilience: Strengthening banks to withstand shocks and attract investor confidence.
• Enhanced Financing Capacity: Building larger, well-capitalized banks capable of funding major projects.
• Credit Market Discipline: Reducing non-performing loans (NPLs) through better accountability and transparency.

These reforms align with Règlement N° 01/02/CEMAC/UMAC/COBAC, which underlines the importance of financial stability and solvency.

2. Strengthening Capital Adequacy

The proposed framework shifts from capital adequacy to capital strength.

• New Minimum Capital: Increased from XAF 10 billion to XAF 25 billion.
• Compliance Timeline: Existing banks have until 2029 to meet this new standard.
• New Entrants: Applicants must meet the XAF 25 billion capital requirement immediately.

Implications

• For Banks: Time to review capital strategies, consider mergers, or raise equity.
• For Customers and Investors: Stronger, more transparent institutions—but fewer new entrants.
• For Legal Experts: Surge in transactions such as capital increases, rights issues, and M&A deals under COBAC and OHADA frameworks.

3. The Blacklisting Regulation: A New Era of Credit Accountability

Perhaps the most consequential reform is the introduction of a regional credit blacklisting system—a powerful tool for credit discipline.

Who It Affects

1. Individual borrowers who default.
2. Companies that fail to meet obligations.
3. Controllers, beneficial owners, and guarantors — effectively piercing the corporate veil.

Sanctions

• Blocking of existing bank accounts across CEMAC.
• Inability to open new accounts in any member country.

Implications

• For Banks: Need for integration with centralized blacklisting systems and strong due process.
• For Borrowers: Defaulting becomes regional, not local — reinforcing responsible financial management.
• For Lawyers: Increased advisory demand on liability exposure, corporate governance, and credit disputes before the CEMAC Common Court of Justice.

4. Implementation Timeline: Preparing for 2026

The new COBAC regulations are set to take effect on January 1, 2026.
This is not a waiting period—it’s a preparation phase.

Key Action Points

• Stakeholder Collaboration: The involvement of COSUMAF, OHADA, and regional courts reflects an effort toward a unified and enforceable framework.
• Early Compliance: Institutions should begin internal policy reviews, legal structuring, and risk assessments immediately.

5. Key Takeaways

1. A New Banking Paradigm: CEMAC’s financial ecosystem is being restructured for scale, resilience, and accountability.
2. Capital is King: The XAF 25 billion threshold will drive consolidation and strengthen the market.
3. Accountability is Personal: Blacklisting regulations extend responsibility beyond corporations to their ultimate owners.
4. Legal Synergy: Success depends on integrating COBAC rules with OHADA and national frameworks.
5. Act Now: With implementation approaching, early preparation will define future competitiveness.

Conclusion

The CEMAC banking reforms mark a decisive move toward a stronger and more transparent financial architecture. While the new rules demand significant adaptation, they offer the foundation for lasting trust, stability, and investor confidence across Central Africa’s financial markets.

About Fonyam and Partners Law Firm

Fonyam and Partners is a leading business law firm in Central Africa, providing expert advisory and representation in financial regulation, banking law, and corporate governance.
Our mission is to guide institutions and investors through complex regulatory transitions with clarity and compliance assurance.