Banco Angolano de Investimentos (BAI) plans to raise the share of loans to the private sector to about 40% as it backs Angola’s push to diversify the economy away from oil and gas.

The timing is favourable. Angola is hosting the high-level European Union–African Union summit on Monday and Tuesday, bringing together leaders and policymakers from both continents and underscoring Luanda’s growing profile as a regional economic and diplomatic hub.

The meeting could open fresh channels for foreign investment and cross-border co-operation – factors that would support BAI’s ambitions along the increasingly strategic Lobito Corridor.

Sovereign exposure under pressure

The growing opportunities in mineral-rich neighbours, already drawing in other African banking groups, are adding urgency to BAI’s regional plans.

“The transition from an oil-based economy can take five to seven years. So, we have to be cautious, and our main objective is to diversify our portfolio.

“If we manage going lower than 60% margin, the better,” BAI chief executive Luis Lelis told The Africa Report on the sidelines of the African Financial Summit Platform in Casablanca earlier this month.

Regulators expect Angolan banks to trim sovereign exposures and step up lending to agribusiness, industry and mining to support diversification and growth.

Yet many lenders still favour the safer returns on government paper in a conservative monetary policy environment.

BAI currently derives about 68% of its net interest income from government loans, mainly treasury bonds.

Angola will come up on top as new opportunities for growth will arise in this process of diversifying the economy

Over the next three years, it aims to cut that share to an industry-wide target of 60%.

“It is difficult to reduce the nominal amount granted to government. We can only try and increase the amount of lending to corporates and individuals. Hopefully, we are making the right decision on credit risk analysis,” says Lelis.

The caution has a rationale. Lower oil prices and delayed eurobond issuance amid volatile markets have pushed the Angolan government to rely more heavily on domestic borrowing.

Despite falling production, oil still anchors the economy, even as new fields and value-addition projects come on stream.

Energy majors – including state-owned Sonangol, TotalEnergies, ExxonMobil and Chevron – are deepening their exposure.

Angola is Africa’s second-largest oil producer, with an upstream sector worth more than $200bn, and banks are keen to stay close to that business.

BAI forecasts annual revenue growth of 22-25%, reaching about $260m by 2025. In 2024, group profit came in at Kz174bn ($189.7m), on total assets of Kz5.47tn.

Tough macro backdrop

The operating backdrop is challenging: high interest rates, hefty debt-service costs and a weakening kwanza have weighed on growth and constrained banks’ willingness to lend.

The central bank, Banco Nacional de Angola, has kept policy tight to rein in inflation, which stands at 17.4%.

DRC will be prioritised in our expansion. We feel more comfortable and looking how we can extract value from DRC

In September 2025 it delivered its first rate cut in two years, trimming the benchmark to 19%.

“It is very hard to grant loans with the high-interest-rate environment,” says Lelis.

Even so, he argues that there are still bankable domestic projects in agriculture and mining.

“Angola will come up on top as new opportunities for growth will arise in this process of diversifying the economy,” he says.

Luanda sees particular potential in mining, especially diamonds.

In 2024, Angola produced a record 14m carats of rough diamonds, making it the world’s third-largest producer after Russia and Botswana.

Beyond diamonds, planned copper and iron ore projects are expected to move ahead as investments along the US-backed Lobito Corridor – linking Angola, the DRC and Zambia and potentially Tanzania – materialise.

The corridor is designed to boost cross-border trade in central Africa and is likely to shape BAI’s next phase of regional expansion.

DRC in focus

“DRC will be prioritised in our expansion. We feel more comfortable and looking how we can extract value from DRC.

“Obviously, the extractive industry is being eyed by everyone but there is a lot of trade between the two countries,” says Lelis.

The DRC’s size, largely unbanked population and natural resources make it highly attractive despite persistent conflict and poverty.

The country holds some of the world’s richest deposits of copper, cobalt and lithium – all critical to electric vehicles and the global energy transition – drawing in multinationals that need trade finance, treasury services and corporate banking.

BAI will be competing with lenders from Kenya, South Africa, Nigeria and Tanzania that are either entering or scaling up in Kinshasa.

Nigeria’s Fidelity Bank has confirmed plans to move into the market, following FirstBank, Access Bank and UBA.

We are first consolidating our position in Angola but analysing the movement of other banks and our clients

South Africa’s Absa operates via a partnership with Rawbank, Kinshasa’s leading bank.

Kenyan groups KCB and Equity have also entered through acquisitions.

Even so, there is room for new players. The DRC has only 18 licensed banks serving a population of about 100 million, of whom fewer than one in 10 holds a bank account.

“We are following and talking to our clients to understand if there is an opportunity and if the size is adequate and profitable,” says Lelis.

Consolidating the base

BAI – the best-performing stock on the Angola Securities and Debt Stock Exchange (BODIVA) – currently has operations in only three external markets: Portugal, São Tomé e Príncipe and Cabo Verde.

Earlier plans to open in London and Asia have been put on hold while the group reviews its businesses in Cabo Verde and Portugal.

In São Tomé e Príncipe, BAI holds a 25% stake and has no plans to raise it.

“We are first consolidating our position in Angola but analysing the movement of other banks and our clients,” says Lelis.