Accordingly, given deep recession in many industrial countries, some businesses may have trouble with repayment of credit facilities. Also as investment financing drops off, business projects may be incomplete thereby saddling banks’ balance sheets with non-performing assets.
At a micro level, some exporters are reportedly already finding it hard to obtain trade credits from abroad which could cripple the export sector that has to contend already with falling foreign demand. The above concerns provide an opportunity for central banks in Africa to strengthen their regulatory capacity by setting up financial stability units as well as the required capacity.