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​​Banco de Cabo Verde directly succeeded the Cabo Verdean branches of Banco Nacional Ultramarino and Banco de Fomento Nacional.


Banco Nacional Ultramarino was, for 111 years, the main banking institution in Cabo Verde, having indelibly marked local commercial activity. In fact, Cabo Verde having been a Portuguese colony until July 5, 1975, the kingdom of Portugal, through a charter dated 16 May 1864, granted Banco Nacional Ultramarino the exclusive privilege of issuing bank notes over the entire territory of the colonies. Article 2 (1) of the aforementioned charter further determined that the Cabo Verdean branch would be established within a year.

Banco Nacional Ultramarino started its banking activities with the Praia Branch, which was opened in October 1865 and was headed by Clarimundo Martins, according to an Ordinance dated 4 October 1865 that was communicated to the colony government by the Marines and Overseas Ministry. The aforementioned branch began its operations modestly with a capital of 30,000 escudos, receiving deposits with interest ranging from 3% to 5%, depending on the terms. It took bills, sold drawings on the country with also variable premiums, in accordance with the payment terms. It progressively expanded its operations.

In addition to the city of Praia, Banco Nacional Ultramarino established the S. Vicente Branch in 1894 and the Sal Delegation in 1948, in addition to correspondence at all municipalities.

​In 1973, in order to fill the gap resulting from the fact that Banco Nacional Ultramarino did not carry out medium and long-term credit operations, namely agricultural and livestock loans, industrial and real estate loans, and Caixa de Crédito de Cabo Verde’s reduced share, Banco de Fomento Nacional set up an office in Cabo Verde to boost production activities.

Banco de Cabo Verde

In addition to the aforementioned credit institutions, which were headquartered in Portugal, there were also "Caixa Económica Postal," created in 1928 as part of the Postal and Telecommunications Services’ organization structure with the aim of financing consumer credit and attracting small savings, and Caixa de Crédito de Cabo Verde, created in August 1962 with the aim of granting agricultural, livestock, industrial and real estate loans.

As part of the political and administrative implementation of national economic integration, the Banking Inspectorate was established in late 1963 with the purpose of ensuring the smooth functioning of the foreign exchange market, establishing the exchange rates that Banco Nacional Ultramarino's offices should observe, monitoring compliance with legal and regulatory provisions on foreign exchange trade, etc."

With the advent of National Independence, it was important for Cabo Verde to fully assume its sovereignty, in particular to exercise its inalienable right to issue currency, through an exclusively national issuing institution. Thus, Banco de Cabo Verde was established by Legal Decision No. 25/75, dated 29 September, having been assigned the exclusive duties of central bank and issuer, foreign exchange authority, Treasury and commercial bank.

On June 30, 1976, through Legal Decision No. 13/76, dated 26 June, Banco de Cabo Verde’s first Organic Law was passed, maintaining the institution’s initial purpose as defined in the law that created it with a capital of one hundred million escudos. That capital was increased to four hundred million escudos in 1981.

After the duties, assets and liabilities of the departments of Banco Nacional Ultramarino and Banco de Fomento Nacional were transferred to BCV, through bilateral negotiations between the two governments, Banco de Cabo Verde started its public activities as a multi-function bank on July 1, 1976. Banco de Cabo Verde thus direclty succeeded the Cabo Verdean branches of Banco Nacional Ultramarino and Banco de Fomento Nacional.

Following a sharp depreciation of the Portuguese escudo, decreed by the Portuguese authorities, on March 1, 1977 the Government of Cabo Verde decided to disconnect the CVE from the PTE, with the Cabo Verde escudo becoming linked to a basket of currencies representing the countries with which Cabo Verde had more intense economic relations.

On 1 July 1977, as part of its first anniversary celebrations, Banco de Cabo Verde circulated its first banknotes, the Cabo Verde escudo (CVE), at par with Portuguese escudo, thus replacing the Banco Nacional Ultramarino banknotes then in circulation.

Up to March 1981, Banco de Cabo Verde had been managed only by its Governor, which flagrantly violated its Organic Law, which gave the Executive Board general powers to carry out the acts necessary to pursue the Bank’s objectives. Thus, and also with a view to strengthening the Bank's management capacity, in March 1981, Banco de Cabo Verde’s first Executive Board was appointed, with the directors being recruited among the institution's employees.

During the 1980s, Banco de Cabo Verde carried out intense activities, translated, essentially, in the implementation of the following programs, namely:
Reorganization and restructuring of services;

• Approval of Banco de Cabo Verde's Staff Regulations;
• Beginning of computerization of various central services;
• Banking services in the country, through the creation of a network of branches in almost all municipalities, substantially improving banking coverage in the country;
• Development of programs to support the productive sector, through the creation of special incentives for emigrants, as well as for the various sectors of activity considered priority by the Government, with the Investment Department having been created to manage these programs as well as those that were under the responsibility of Caixa de Crédito de Cabo Verde, extinguished in 1984. 

In August 1985, Banco de Cabo Verde’s Organic Law was revised, in order to improve its operation, and the position of Deputy Governor was extinguished, having been recovered in the Organic Law of 1993. 

In 1990, a new Organic Law was passed in order to strengthen Banco de Cabo Verde’s central bank aspect. With the aforementioned law, Banco de Cabo Verde’s main duties became monetary and foreign exchange policy manager and Government banker, although it continued to temporarily act as commercial and development bank. The aforementioned Organic Law was a law to transition to the new times ahead. 

Lei

During the period between 1991 and 1993, the Executive Board focused on preparing the technical and material conditions for removing the commercial and development aspects from Banco de Cabo Verde.

Thus, in August 1993, as part of a broad economic and financial reform program initiated by the Government after the 1991 democratic elections, a new Banco de Cabo Verde Organic Law was passed, with the Bank now acting exclusively as central bank.

On September 1 of the same year, the commercial and development aspects were removed from Banco de Cabo Verde, resulting in the creation of Banco Comercial do Atlântico, Sarl, a public limited company, thus putting an end to 17 years of a mono-bank system.

With the removal of the commercial and development aspects, Banco de Cabo Verde's work has, since then, been focused on training and strengthening its role as a central bank. In fact, the economic reforms initiated in 1991 have favored the market as a central mechanism for regulating the economy, which has led to a progressive liberalization of the financial sector, requiring profound changes in the way monetary and foreign exchange policies are managed.

Since it was considered convenient to concentrate the duties of supervising the entire financial system in a single institution, Banco de Cabo Verde was entrusted with the task of supervising and controlling the institutions that operate in the monetary and financial markets; that is, credit and non-bank institutions, institutions in the insurance sector, as well as the capital market.

As part of the Exchange Cooperation Agreement and respective Additional Protocol entered into by and between the Portuguese and Cabo Verdean governments, as of April 1, 1998 the Cabo Verde escudo (CVE) had a fixed exchange rate to the Portuguese currency (PTE), and, consequently, the EURO.



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