The West African Economic and Monetary Union's central bank- BCEAO reported a robust triple-digit increase in revenue from its external assets, reflecting its effective resource management. However, despite this surge, the gains fell short of the potential returns had the funds been invested in the accounts of the French Treasury.

In its latest financial report, BCEAO revealed that its external assets yielded CFA177 billion ($287.3 million) for the fiscal year 2023, marking a significant 112% increase from the previous year.

This marks the second consecutive year since BCEAO started to manage its entire foreign currency reserves outside the French Treasury's accounts. The hike in revenue was fueled by various factors, including improved returns from assets denominated in currencies other than those of the International Monetary Fund (IMF), witnessing a notable uptick of 139%. Furthermore, interest income surged by 74%, while a considerable portion of reserves, totaling CFA3,660.5 billion, was strategically invested in state-issued securities.

Despite this performance, the institution acknowledged that the gains realized were lower compared to the potential returns from investing in the French Treasury. An analysis by Ecofin Agency suggested that the majority of WAEMU countries’ reserves garnered an average yield of 0.94%. This lower return underscores a notable discrepancy, especially when contrasted with the 4.75% marginal lending facility rate offered by the European Central Bank. Currently, this rate remunerates foreign currency assets held in accounts by the Cemac countries and the Comoros, still operating under the former monetary cooperation framework with France.

Despite the institution's good fiscal performance, some areas remain opaque. The BCEAO's financial report did not provide sufficient insight into the management of the WAEMU's foreign exchange reserves, particularly regarding investment strategies. However, it is known that a significant portion of external assets was provided by the IMF, generating the highest foreign exchange revenues, totaling CFA85.13 billion, marking a significant increase of 133%.

At the end of the fiscal year, BCEAO's net profit was CFA315.6 billion. Apart from revenues generated by foreign currency assets, the institution benefited significantly from heightened refinancing demand by commercial banks. This demand resulted in a substantial increase in interest income, amounting to CFA329.4 billion, up 112%.