By Stanley James
THE Lending capacity for banks is expected to improve as all financial institutions have met minimum capital requirements ahead of the December deadline.
The Reserve Bank of Zimbabwe (RBZ) directed banks some months ago to meet minimum capital requirements equivalent to 30 million United States dollars by December 31 this year.
Official information from the RBZ indicates all banks have met the requirements with Confederation of Zimbabwe Industries Banking and Economics Chairperson, Jimmy Pscillos describing the development as a reflection of the banking sector stability and ability to lend in future.
“That they have managed to meet the requirements testify to the fact that the trend will positively impact efforts to stimulate savings,” said Jimmy Pscillos, CZI Banking and Economics Chairperson.
Institute of Chartered Secretaries and Administrators Chief Executive Officer, Dr Lovemore Gomera outlined the importance of banks in focusing on lending idle foreign currency deposits.
“The tally is so pleasing such that we commend the central bank in its effort to boost liquidity for the entire economy,” said Dr Lovemore Gomera, Institute of Chartered Secretaries and Administrators Chief Executive Officer.
Minimum capital is the capital requirements banks are supposed to hold as a defence against losses or to support lending.
The capital threshold also acts as an indicator of the banking sector strength.