Time running out for Zim banks

Johannesburg - The deadline is nearing for Zimbabwe's banks to meet minimum capital requirements of US$12.5m, the Herald reported on Monday.

Reserve Bank of Zimbabwe Governor Dr Gideon Gono was quoted as warning banks that they had until the end of this month to meet the requirements and that there would be no change to the deadline.

He said action would be taken against defaulting banks.

Curatorship, however, was ruled out.

"We have no appetite for curatorship, we have gone that route before and it does not work," he was quoted as saying.

Gono's comments come at a time when almost 10 of Zimbabwe's financial institutions have indicated that they had already met the minimum capital requirements.

"Others have however been busy running around to raise the required capital with CFX and Genesis announcing this week that they were floating rights issues to raise US$10m and US$7.3m respectively," the Herald said.

It added that in June Zimbabwe's Reserve Bank had sent out a circular to financial institutions outlining a phased enforcementof the minimum equity capital requirements.

"According to the plan banks are supposed to satisfy 50% of the requirements by September 30 while the remainder must be settled by March 31 next year."

According to the Herald's report, commercial banks must have a minimum capital of US$6.25m by September 30 and US$12.5m by March 31.

Building societies and merchant banks should have US$5m by September 30 and US$10m by the close of business on March 31 next year.

Finance and Discount Houses were required to have US$3.75m this year and US$7.5m by March 31.

The Herald said asset managers were supposed to have US$1.25m as minimum capital by September 30 and US$2.5m by March 31.

- Sapa