After a “long journey through the desert” of an economy plagued by recurring crises and a shortage of foreign currency, only 22 currency exchange houses remain in the country — and one of them currently has a suspended license. In 2017, there were a total of 121 licensed institutions. Limited access to foreign currency has complicated business. Exchange houses operating within the national financial system continue to lose ground in the foreign exchange market, which has been dominated by commercial banks and the informal market.
Between 2019 and 2024, there was a 93% drop in foreign currency sales operations to customers by exchange houses, from USD 46.8 million to USD 3.5 million — a consequence of the reduced volume of purchases from commercial banks, according to calculations by Expansão based on data from the National Bank of Angola (BNA).
Over the same period, the volume of foreign currency purchases by exchange houses from both customers and banks dropped 96%, from USD 97.1 million to just USD 3.8 million last year.
During an Expansão tour of eight exchange houses in Luanda, it was evident that all of them shared the same situation: empty, with no people entering to trade currency. Only two reported availability to buy, sell, and transfer currency abroad — but only in euros. Of those two, one claimed to have availability for selling in another branch, while the other guaranteed it would be available the next day. The remaining six revealed they had no foreign currency to sell and were only available to buy. Some staff admitted they can go several weeks without carrying out a single transaction. In fact, several were unable to even provide the current exchange rate.
The cooling of activity in the exchange house sector is not new. It is a scenario that began to worsen after the 2014 crisis and became even more complicated in 2018, when these entities were barred from accessing the BNA’s foreign currency auctions. That year, they spent several months in a “limbo,” with no access to foreign currency from the central bank, until the BNA issued a directive allowing these institutions to access foreign currency directly from commercial banks.
Since then, the market has continued to see the closure of exchange houses for exceeding the legally allowed period of inactivity, among other reasons. Since 2017, the BNA has closed 99 exchange houses across the country. In 2017, there were 121 licensed institutions operating. Today, after years of economic hardship and ongoing foreign currency shortages, only 22 remain — and one currently has its license suspended.
“Restrictions on access to foreign currency, lack of business activity, legal limitations on the sector’s ability to attract foreign currency, poor distribution of available foreign currency, and the excessive power of commercial banks in decision-making over foreign currency allocation for the normal functioning of the exchange sector” are cited as the main causes of the current state of exchange houses in the country, according to the president of the Association of Exchange Houses, Hamilton Macedo.
2024 Was Better Than 2023
According to the BNA’s annual report, in 2024, exchange houses reversed the trend and showed slight growth compared to 2023. Sales volumes increased 22%, from USD 2.9 million to USD 3.5 million year-on-year. Meanwhile, the volume of purchases by exchange houses reached USD 3.8 million, a 12% increase compared to 2023 (see chart).
As for the total assets of exchange houses, they fell 19% year-on-year, reaching Kz 3.5 billion — a reduction of Kz 850.5 million.
Despite the reduced activity, exchange houses continued the trend of increasing profitability, ending 2024 with positive results of Kz 89.4 million, up from Kz 38.5 million in the previous year.
Source: Expansão
