Ecobank has bought a 90 percent stake in Rwanda's third largest bank for 6.4 billion Rwandan francs ($11.6 million), the country's central bank governor said over the weekend. The bank will take over Rwanda's Bank of Commerce, Development and Industry (BCDI), which was declared insolvent in 2006 due to huge financial losses. "With effect from today, Ecobank takes over BCDI for a value of 6.4 billion Rwandan francs. The bank will be known as Ecobank Rwanda," said Francois Kanimba, that country's central bank governor. Ecobank, a leading banking group with a network of branches in 18 countries across West and Central Africa, is listed on Ghana, Nigeria and Ivory Coast.

BCDI has lately been burdened by heavy losses arising from huge non-performing loans, inadequate operational controls and poor corporate governance, Kanimba said. Its losses amounted to 2.5 billion francs with a 46 percent non-performing portfolio. "BCDI has been operating at huge losses due to gross mismanagement," he said. "Ecobank's new contribution will partly cover the negative equity and also recapitalise the bank." The remaining 10 percent of shares will go to the bank's existing share holders. Rwanda, which has seven commercial banks and dozens of mushrooming micro finance institutions, has also lined up its biggest commercial bank, Banque de Kigali, for sale before close of this year. In 2004, the nation sold off 80 percent of the Commercial Bank of Rwanda to the Commonwealth Development Cooperation (CDC-Actis) for $6.05 million. Rwanda's banking sector is still crippled by a huge percentage of non-performing loans stemming from a 1994 genocide in which bank borrowers were either killed or fled the country at the height of the massacres of an estimated 800,000 Tutsi and Hutu moderates.