RBZ measures to negatively affect banks

CBZ Holdings group chief executive officer John Mangudya has warned of “some financial knock off on every bank” emanating from a raft of measures introduced by the Reserve Bank of Zimbabwe (RBZ).

Report by Tarisai Mandizha

The RBZ last month signed a memorandum of understanding (MoU) with banks providing a framework for determining bank charges and interest rates margins following complaints by the transacting public.

Under the MoU, the central bank and the financial institutions agreed to develop a standardised format of disclosure requirements to ensure that participating financial institutions clearly disclose all their fees and charges in a uniform manner.

This is meant to ensure that customers make informed choices and comparisons among banks.

Banks generate their revenues from three broad sources — net interest income, fees and commission, and trading revenue.

Mangudya told an analysts’ briefing in Harare on Tuesday that the group complied with all requirements of the regulatory bodies, but “going forward it is going to be a game of volumes rather than charges since the agreement of the MoU”.

“We are very compliant and we have changed our systems to cap both bank interest and charges,” he said.

CBZ is the country’s largest bank by assets and deposits.

Mangudya said the RBZ regulation for financial institutions to commit 30% of their loan book to support growth for the Small and Medium enterprises (SMES) sector was work in progress.

“All that we are going to be doing is to check for qualifying customers across the sector.

“By this year we may not grow to 30%, but by year end we will be at 15%,” he said.

Mangudya said the commitment may require two or so years as this could not be done overnight.

He also said during the course of the year the group purchased 10% of its shares on buy back at a price value of $7 million.

“By so doing, we are also putting money into the economy which is so dry,” Mangudya said.

“The 10% shares we have purchased, we are going to identify a strategic partner to take the shares to provide capital.”

He added that the group hopes to find an investor that has a similar objective to grow the businesses.

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