Credit extended to Cape Verdean families for consumption and other purposes accelerated in 2025, driving a slight upward trend in the household bank indebtedness indicator over the last two years, the central bank indicated.
The latest Financial Stability Bulletin points toward a faster growth rate for consumer credit and other household financing options throughout 2025. It additionally highlights a minor upward trajectory in the metric tracking how much banking debt local households are carrying over the past twenty-four months.
Risks regarding the potential degradation of the overall financial situation of these families persist, and remain heavily conditioned by how consumer prices for goods and services evolve going forward. The Bank of Cape Verde (BCV) noted that while a deceleration of inflation occurred during the first quarter, risks concerning intensified inflationary pressures remain present for the upcoming months.
Earlier this month, the central bank officially raised its inflation estimate for the current year from an initial projection of 1.7% up to 2.7%.
Read more about this topic: Cape Verde with a 0.4% GDP budget surplus
When looking at the corporate side, the regulator registered a noticeable deceleration in the growth of credit extended to businesses, with the commercial bank indebtedness indicator maintaining a steady downward path since 2021.
On the banking side, the country is witnessing a continuous improvement in the overall quality of the loan portfolio across the financial system. Furthermore, the solvency rate of the sector strengthened once again, hitting historically high levels of 24.8% in December 2025.
This latest registered solvency percentage is more than double the mandatory regulatory minimum threshold of 12% and represents the highest level achieved by the domestic banking system since 2010. However, a specific warning remains active in the official document, noting that the heavy concentration of total deposits among institutional depositors continues to present a structural liquidity risk.
This vulnerability is underscored by the fact that the five largest depositors held roughly one-quarter of all total banking deposits.
Read more: Cape Verde: import prices rose in March due to expensive fuel
On a global scale, the Financial Stability Index reached its highest level of the entire statistical series in 2025, mainly reflecting the clear improvement in metrics tied to the robust health of the banking system.
