Transcript | Willy Mulamba

Arthur Katalayi (Host): Hello, I am Arthur Katalayi, Senior Partner of A2K Advisory,

Today we have the CEO of Citibank, a major American bank. Hello, Mr. Willy Mulamba, thank you for welcoming us today!

Willy Mulamba (Guest): Thank you. Hello, dear Arthur, it’s a pleasure to have you in my office today.

Arthur Katalayi: We’re going to go back a bit to your academic journey, your life journey that brought you to where you are today. You were born in Congo and then you studied in Belgium and the United States where you have gained work experience, can you tell us more about that?

Willy Mulamba: Yes, as you well said I followed a bit of the traditional path as a Congolese, especially from a certain generation. I obviously did my primary and secondary studies in Kinshasa and the humanities too. Obviously, when I finished, I also gave myself the opportunity to continue my training abroad.

And culturally, as Belgium has always been the country where most Congolese go to do their university education, obviously, I also took the opportunity to go to Belgium,

Arthur Katalayi: At the University of Liège?

Willy Mulamba: At the University of Liège, exactly where I was admitted to the faculty of economics and after five years, I was able to obtain a master’s degree in applied economics; and immediately afterwards, I went to the United States where I started working directly. Obviously at first, I enrolled in a language school to get acclimatized to this environment which was new to me and the English language was an obligation to enter the job market. And after a year, I started working…

Arthur Katalayi: In finance? Have you been in this field since the beginning?

Willy Mulamba: Listen, it’s true that it’s in finance; but a major fact is that my first job in the United States, as I didn’t speak English yet, I started selling pizzas. It was at the airport in Boston, in the State of Massachusetts, where there was a small entity that made Boldini pizzas and that is what allowed me to be able to acclimatize easily because I was in contact with clients and at the same time I was taking English lessons. It made me feel a bit comfortable very quickly.

And afterwards I threw myself into the job market and for 8 or 9 years, I worked for 3 or 4 large American firms, and I was mainly in the financial field. Then I returned to Kinshasa to join the Congolese banking market.

Arthur Katalayi: And so you had an overlap from country to country, from Congo to Belgium and then France quickly?

Willy Mulamba: No, France was while I was already working. After ten years, I felt the need to specialize more in the sector in which I work. It’s true that I trained as an economist, but I thought I needed to specialize more in the banking sector to obviously give me more opportunities and more tools to do my job better. This is how in 2016 I enrolled at the University of Paris Val-de-Marne, which is part of the Paris Saclay group.

I trained for a year and a half. And from there, I was able to obtain a Masters 2 in Banking and Finance, which came on top of my first degree from Liège where I had obtained a Masters in Applied Sciences. And during my visit to the United States, I also took some training at the University of North Texas, in the State of Texas. I was able to do additional training in order to familiarize myself with the professional world in which I had embarked while I was in the United States.

Arthur Katalayi: Of course. So in fact, the aggregation of all your experiences in the United States then led you to join Citibank, here in the DRC. Citibank is an American bank, one of the largest with $21 trillion USD in assets under custody and a market capitalization of approximately $83 billion USD, which is part of the Citigroup which is a much larger American financial group. And Citi has been in the DRC since 1971?

Willy Mulamba: Yes, that’s right.

Arthur Katalayi: But we don’t hear a lot about Citibank, unlike other banks on the market, and we know that you are not a classic deposit bank as we can see in the DRC, what are your main banking activities in the DRC; historically, presently, and in the future? Because there are many things that are happening with the economic changes at the global level and the importance that the DRC is taking by the resources of which it abounds.

Willy Mulamba: Okay, I think it’s a pretty complex question that touches on several points, and I’ll start with the first aspect first: Why did I decide to come back to the DRC? It is first of all out of patriotic duty. So as much as I was in good conditions in the United States, after having studied in Belgium, I felt a call to come back to the country too to bring my little stone with the little experience I had already acquired when I was on the other side, but also culturally, I felt closer to the DRC and perhaps to America of course, 17 or 18 years ago.

I started to explore how I could get an opportunity to come back to the DRC. And this opportunity was given to me by Citibank. I came back at the end of 2006 and started in April 2007 as a treasurer.

My main job was to reassured only in terms of the bank’s commitment and liquidity. I was the person who had the power to reassure that from the ALM point of view (Asset and Liability Management) I was the bank’s safeguard to make sure that the balance sheet was optimal and was well managed in terms of customer contributions but also commitments vis-à-vis regulators. In our case the DRC, the Central Bank of Congo and, to some extent, some other state agencies such as CENAREF…

Arthur Katalayi: CENAREF is it?

.Willy Mulamba: …National Financial Intelligence Unit.

Arthur Katalayi: Okay,

Willy Mulamba: So that’s it to get back to Citibank. We have been present in the DRC for 51 years so it is since 1971, as you said, that we have been present.

So we are a bank within Citigroup and that is, as most people assume and know, we are spread practically all over the planet. We are present in more than 100 countries. We have many operations, but also where we obviously do not have a physical presence, we also support our clients by providing them with management tools that can allow them to have access not only to the financing of their activities, but also facilitate payment vis-à-vis their partners. So in the DRC as much as in Africa where I would say, the emerging markets, Citi has a policy which is focused on certain specific aspects of the bank. In a much broader sense, we have multiple segments. We have the retail bank, that is to say Arthur and I, Willy. We have an account with commercial banks. We make a transaction to receive our salaries, make a little deposit, transfer payments vis-à-vis the family, it is called retail banking. But we also have the investment bank, the commercial bank. We have the bank that allows us to support clients in fundraising, how do they access the capital market, but also we also take care of everything that is, as we call it, the facilitation of our clients to great wealth; what is called private banking, people who have large amounts of capital; but also beyond.

Arthur Katalayi: Alright.

Willy Mulamba: So in the DRC, and as much in Africa or in most emerging countries, the option that has been exercised is to be able to do two or three aspects of banking in general, in particular corporate banking, that is to say that we support our large customers in their needs in terms of financial matters and also in banking matters.

So we also have commercial banking for entities that are in different activities of the global economy, and we also support banks. We are also the bank of banks, given our global network. We work with commercial banks to which we give what they call solutions, and facilitate infrastructures to be able to carry out their activities in the segments where we are not present.

If you are commercial in the DRC, and you generally have to make certain financial services available to your customers, you need to be accompanied by an international bank, not only beyond the volume but certain financial aspects, given that the bank does not work in a vacuum; when you are a bank you have to be connected with the rest of the world because the customers you have also have partners who are in other countries and these banks need to be accompanied by a solid and international partner.

This is how Citibank provides commercial banks with facilitation to allow them to operate. We call it FCB (Foreign Correspondent Banking). So obviously in the DRC, as I said, there are three aspects: We also support non-governmental organizations, the largest such as United Nations agencies.

And here, then, that makes us vis-à-vis the clientele, we are quite selective with the clients we can have to work with and our typical clientele are multinational companies that have activities in several countries. For example Coca-cola, which is everywhere on the planet, obviously needs to be accompanied by a bank that has a global presence.

So it is with these types of clients that we work. And so, as I said, that puts us in a position where we are not very well known in DRC, because we are not the bank for the general public but we do a lot for the DRC, as much as other countries where Citibank’s contribution is immeasurable in terms of what we bring to both private and even public sector clients.

But also there is a very important aspect as I said, we not only advise our clients in the private sector, but also in the public sector for access to financial resources on the major stock exchanges of the world. I would like to drop on an important aspect today, when we take the mining sector; we have large operators to be able to invest in the mines, does that require very large financial resources?

Arthur Katalayi: Absolutely.

Willy Mulamba: And unfortunately, these resources cannot be found locally in the country. Generally, it is the big stock markets that you have to go to in order to be able to raise funds and invest. We support all these large manufacturers to give them the resources they need to build the factories and operate.

Arthur Katalayi: And so what does it mean that Citibank is also present in the future mining sector, knowing that the mining sector is the cornerstone of the Congolese economy through the revenue it generates. You are also in the sovereign advisory in which you are already involved with the aim of convincing institutional investors to inject their capital into viable projects in the DRC. How is it that this conversation is not much more frequent in the DRC, knowing that we have a lot of assets and little liquidity and we do not have this reflex to go to international markets? There is not yet this reflex and automatisms here. How exactly can we make the switch?

Willy Mulamba: I have a different point of view, I don’t think it’s a question of reflexes, we are already a major player in the contribution that we put in place vis-à-vis our partners; both for clients in the private sector and in the public sector. As I said, as far as the public sector is concerned, we support our major clients in fundraising, I would even say beyond the mining sector.

With the DRC, Citibank supported the largest American companies that were here at the time, such as General Motor which was there right where the Mutombo Dikembe hospital is. And at the time we also helped the DRC to order and finance the purchase of planes at the control of Air Zaire, we also accompanied the State to structure the funds for the construction of the Inga Dam…as I said it is more a problem of popularization, these are areas which unfortunately are not put in the public square.

Beyond the private sector, the question to ask is: what are we doing for the State? Very recently, it’s true that we’ve accompanied the Congolese government in advisory to make available the networks we have in terms of financial partners who hold large resources in the West, as much in America or even

in Europe, and that’s what we call the capital market. In the capital market there is a lot of money. There’s a lot of cash.

Arthur Katalayi: There is even an excess in liquidity …

Willy Mulamba: The idea here is to see how we can convince all of these operators of its liquidity and also have an appetite for the DRC.

Arthur Katalayi: Knowing that we must also create the conditions to secure this capital, it is also important to say …

Willy Mulamba: Exactly, it’s very important and it’s even the purpose of the support, so create capacity within the government to obviously also have the right to access these funds which are held by the actors on international stock exchanges …

Arthur Katalayi: …starting with New York, which is the biggest …

Willy Mulamba: Yes, New York but also Hong Kong and Paris… so that’s the very purpose of the support and we hope that at the end of this support, the government of the DRC could also access this market for capital and also be able to raise funds in the private sector in order to make them available to various projects in the sector of public life, in particular health, education and infrastructure, to name just these three. The other countries are already doing it if we look at the countries of the sub-region, especially towards West Africa with Côte d’Ivoire and Senegal; those countries are gaining access already in the capital markets. In these countries there are major infrastructure projects; obviously, it is thanks to the support of international banks that they managed to access large financial resources which unfortunately are not always available here.

I would like to recall that the DRC today has about fifteen banks. If we take all the banks together, the resources do not exceed $10 billion USD to $11 billion USD in terms of deposits, and these deposits are very short term and as such, they cannot be used to finance the big projects and large projects

which are generally long-term. So it is critical and important for the State to be able to turn to other sources of funding. It is true that they are already doing an excellent job with bilateral and multilateral parties. But we also think that another good source would also be the private sector which could raise the funds at the level of capital markets.

And we hope that in the long term we could support the State in issuing the first Euro Bond. …

Arthur Katalayi: It was done in Benin recently.

Willy Mulamba: Yes, and it was obviously at that time and it was Citibank who had accompanied. So that’s it.

Arthur Katalayi: As the boss of Citibank, you are also the head of the Congolese Association of Banks.

Arthur Katalayi: How do you see the development of the banking sector in the DRC, and the new deal which is that foreign banks are flocking to a juicy market of 100 million people, but with minimal banking compared to the size of the country? Another argument that often comes up when I have discussions with economic operators, I don’t know if it’s credible or tangible, but it’s that the Congolese in particular complain that there is no Congolese-owned bank run by indigenous people, and that’s it, it bothers them. Why has a Congolese bank run by indigenous people not yet been created? And is it really a necessity today?

Willy Mulamba: Yes, very good. Again, this is a multifaceted question. I will try to be specific in my answer.

To recall the facts of history, I think we are all aware of the great crisis that the Republic experienced in the 1990s to be more precise, because of the security and socioeconomic situation. All economic records were destroyed.

The security situation was very worrying and everything was destroyed. We ended up with a banking sector that practically no longer existed. For those who can remember I think in history we learned that those who deposited money in a bank in

the morning and returned in the afternoon to be able to withdraw it, the banks were not able to serve them. So the result is that banking was done outside the formal banking sector where obviously there were other reflexes from the players in the economy, or we went through systems of three compensation bodies and through different mechanisms, imagine at the time …

Arthur Katalayi: …It wasn’t that long ago

Willy Mulamba: … Yes, about twenty years ago, 1998, 1999 and 2000, we ended up with less than three or four banks. Well, I don’t know all their names, but what is certain is that they had practically all gone bankrupt, and those who resisted had significantly reduced their operations, in particular Citibank. And the good news is that we never left.

Arthur Katalayi: There was a trust deficit; I am sure with the people

Willy Mulamba: Yes, but it was more due to structural difficulties. It had nothing to do with the actors as such; it was the situation at the time that was at the root of this problem.

From that moment, the actors of the time, politicians helped by the international community began to normalize things, especially in the institutions of the Republic. They tried to focus on the basics so they could make it big. It was when the government renewed contacts with donors such as the International Monetary Fund and the World Bank that some very harsh measures were taken to normalize the circulation of foreign currency. We have made the dollar a currency of exchange without restriction. Someone could open an account in dollars; hold the dollar without needing to have prior authorization from the Central Bank of Congo. I remember that in another sector of activity, the price of petroleum products had been liberalized? It was because we were coming back from 3-digit inflation rates, and it was very conservative measures that allowed the private sector to recover.

And then it was at that time, of course, that the financial sector started to rise from the ashes and if my memory serves me correctly, the total of the banks did not exceed $‎200 to $300 million USD for this great country and from 2002-2003, we started to have new actors coming back.

Arthur Katalayi: But does that mean there is still room for a Congolese bank run by locals? This is a question that has come back to me from different actors, so that’s why I’m asking it to you.

Willy Mulamba: I will get there, I first wanted to share the history, and it will answer the famous question of what is the possibility of having a bank with Congolese capital.

At the time, there was resurgence in the financial sector to bring back this confidence which no longer existed with customers, as you said, and to allow people to gradually return to the financial sector and at the end twenty years ago, great efforts have been made. We went from 2 or 3 banks in 2002 to almost 18 banks in 2014 that had a license to be able to operate. Among them were Banque Congolaise, RawBank and TMB which are locally owned banks. Sometimes we tend to confuse national capitals, etc. Then there was the arrival of sub-regional banks like Access Bank, FBN Bank, UBA … For some reasons that we cannot say here, we have gone from 18 to 14 banks today.

All this to say that the financial sector is still vulnerable; of course, vulnerable because of the magnitude that the financial sector has taken in the world as you know, without ignoring the financial crisis in 2008. And following the crisis there, there was a reinforcement of control at the level of the system international financial institutions, there have been new measures and regulations on which have been put in place to impose certain rules on the financial sector which do not always allow the outbreak or the financial system of the banking system, particularly in the DRC.

This came to cut the momentum in which we still saw in the DRC there were several new operators that we had noticed between 2008 and 2013.

So why don’t we have a bank run by the natives? It is a question of will. I don’t think there is a tacit ban on a Congolese not setting up a bank of their own. The regulations are there and they give the possibility to any shareholder or investor to be able to take an interest in the banking field. It is rather up to the will of the sons of this country to be able to invest in the financial sectors, obviously by reassuring them that they have a good reading of the regulations, of the requirements of the Central Bank of Congo which is the regulatory authority for the banking sector – both banking and other business sectors such as mining and telecoms, in logistics.

Arthur Katalayi: And we also see that in other countries, like Russia, big industrial companies like Gazprom have their own bank as well. So it’s something that some state-owned companies can learn from. If indeed it actually applies.

Willy Mulamba: If I had to give a personal opinion, it is a question of will and also we must take into account the history, where we come from and as we all know, the DRC is at the center of much interests. And the challenges are major. Challenges which are all practically in all aspects of a country’s economic activities, as I said unfortunately following the major crises that we have experienced and also geopolitical aspects.

I think that it was first necessary to go through the normalization of normal activities, that is to establish and discuss with donors, something that has been done. And allow the economy to know the fate that everyone hopes for. I don’t think we should go too fast. We must first put these fundamentals in place. The DRC remains a very, very vulnerable country. It is a question of continuing to work with all the international partners and all the guides of the Republic, in order to work together; obviously also try to give the opportunity to those who may be interested in other such other areas of life.

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Arthur Katalayi: Still as a banker and head of the Congolese Banking Association, we often hear several points of views on the dedollarization of the Congolese economy; should we use more Congolese francs or to keep some balance or continue to use dollars. I know the Congolese love to use the dollar more than the Congolese franc for reasons that are obvious, what is your perspective on this?

Willy Mulamba: I think this is a question that should be addressed more to the authorities, because we are only operators, beyond being bankers we are first of all financial intermediaries. We only do financial intermediation. We facilitate by bringing together players from all sectors of the economy, and the Central Bank which is the regulatory authority, the supervisory authority and defines the regulatory framework.

Regarding dollarization, I wouldn’t want to put myself in the shoes of the authorities. These are powers that are vested in them. But I think the country would have a lot more to gain if the local currency had its place. The fact of using the dollar as a transaction currency, I consider it a safe haven currency …

Arthur Katalayi: You’re not the only one, by the way…

Willy Mulamba: Given the recent past of the DRC obviously people take refuge in this currency to be able to protect the value of their assets. But nevertheless, I think that the country would have much more to gain by using a local currency because it gives much more leeway to the authorities, both monetary and governmental, to have a policy that could give more impetus to the private sector. Using the dollar obviously limits this policy which should normally have a positive effect on the economy.

Now, as one might think, there are both the private and public sectors which are also playing their part. But again, it has to be regulated. It is a long debate which is multidimensional. As much as one can dedollarize, it is not an easy exercise. I was personally asked on several occasions to be part of a small think tank at the Central Bank level to share and see what actions to take to further dedollarize the Congolese economy.

Without perhaps going into detail, what I was able to learn from these exchanges is that dollarization is quickly put in place when a local currency loses value, but it is difficult to reduce it. There is a South American country that we talked about in these exchanges that had to take 20 years to be able to dedollarize its economy by 15% or 20%

Arthur Katalayi: It can’t be done in 1 day …

Willy Mulamba: Exactly, I think it’s a big challenge for everyone. Beyond the private and banking sector, given the history of this country, all I can hope is that the government can get there and obviously the bankers remain at their disposal to also play their role if necessary.

Arthur Katalayi: Of course, we tend towards the end of our exchange. The show is called The Right Advice. From your inspiring background and your expertise, what would be the best advice that you would give to companies, individuals, states in a banking industry and in a changing global economy where everything is digitizing and still going crescendo on this ground there. How do you see the present and the future of banking, finance in the DRC and the opportunities? Because we have talked about a lot of issues but there will also be opportunities that will arise with the demand for copper, cobalt, the energy transition, the Gulf countries and the Middle East which are in the process of also gaining strengths in the concert of nations. What would be your advice, your perspectives or orientations? I know this is a multifaceted question …

Willy Mulamba: Yes, again, but I’m used to it. I wouldn’t say that not everyone is allowed to dream there. But I think everyone, with a bit of will, can follow the same path, of course. When I was young a student, I would have been far from thinking I would arrive where I am today. I did my studies in Ngiri-Ngiri at a state primary school called EP 7 et voilà.

Arthur Katalayi: It’s fantastic to have had this experience, it means it’s possible.

Willy Mulamba: My father was a state education official. But to think back then, that I would be running a bank like Citibank …

Arthur Katalayi: One of the most important banks …

Willy Mulamba: Yes, and that obviously stems from the education I received from the parents, at least I had that opportunity. And they also gave me the opportunity to go to good schools at the time, catholic schools, as they were called. But I believe that the most important thing was also my own determination in what I dreamt of being one day in life ;to listen to the parents first, but also to make the right choice. I think that in my career, I paid a little attention to what I was doing and that allowed me to be able to evolve in what I do today.

Arthur Katalayi: And the prospects for the future? How do you see it for the DRC which finds itself at the heart of all strategic interests?

Willy Mulamba: In terms of future prospects, I don’t think I have any new elements to give, as we all know the DRC today is at the center of all global interests; because of its position, first in Africa, but also for its natural resources. It is also its very dynamic and young population but also, I would say that in natural resources, we can first mention the mineral wealth, the forest wealth, the rivers, ….So all that to say that the DRC remains a country that must be supported by the major decision-makers of this world, obviously in a good way. I think my dream is for it to have sincere, win-win partnerships with the rest of the world.

Arthur Katalayi: Even if it is up to the Congolese to set the tone first? And the others will have to follow or in any case in concert with decisions which would be in our interest first? Maybe not always expecting others to accompany us?

Willy Mulamba: That would be ideal, but looking at the history of this country since independence, unfortunately, the Congolese have not been given much capacity to be at the rendezvous of their own development, of their own story.

Finally, as we know very well, from what little we remember of independence we didn’t have many experts at the time, we had academics and I don’t think the situation is any different today. Not necessarily in relation to training or education … but I think it took another form today. It is true that we have trained a lot of experts since independence but I think what is sorely lacking today is to manage to create an environment to allow all the actors to meet, but really in a win-win partnership.

As I have often said, it is not enough to have an expertise or a diploma only but if you do not have the means to be able to set up your own SME (small medium enterprises) and so on… If the holders of capital today do not make this capital available to you it will be complicated.

Personally, I mean that you have to try to take a step back. Find capital in the private sector, the public sector both nationally and internationally and look in the same direction. I think that this capital, which is put at the discretion of the DRC, can also have a multiplier effect on the rest of the world.

I am thinking directly of agriculture; it is said that the DRC has an infinite amount of arable land. And at the time, I followed a documentary, where it was said that if we take a hectare with grains of corn, it could produce about 100 bags of 50KG of corn and with a little technology, and a little of fertilizer on the same surface we can produce 10 times more. And we need partnerships to be able to carry out these kinds of projects.

And so it is important to be able to find the best mechanism or the best approach, so that the partnership that can be created between the public and private sector, not only national, but also international, can be win-win, that’s it!

Arthur Katalayi: Listen Mr. Mulamba, thank you for welcoming us.

Willy Mulamba: It’s a pleasure, the pleasure is all mine. I hope we will have more opportunities to discuss.

Arthur Katalayi: I’m sure of it.