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Zim bankers fear indigenisation - survey

Harare - Zimbabwean bankers are wary of the negative effects the indigenisation laws will have on the sector, a survey has shown.

According to a report by Econometer Global Capital, which has offices in Zimbabwe and South Africa, polls carried out showed that 94% of the banking CEOs who were interviewed believe the indigenisation policy is not suitable at this juncture.

The bankers believe the call for indigenisation poses a latent threat to the stability of a sector which is already on the cliff edge of an uncertain environment.

“In entirety, averages of 1 250 jobs are on the wire in the banking sector if the plans to implement the policies go ahead,” reads the report.

“Banks are also prone to lose two jobs for every 200 bank accounts which are to be affected by the new regulations calling for the scrapping of bank charges on accounts below $800.”

Meanwhile the research unit urged bankers to move from the current scenario, where earnings are biased towards non-interest income.

“The overreliance on non-interest income in a market where authorities can work up with new measures is risky, the forthcoming plebiscite will see more socialist measures being pronounced hence exposing the banks to a dig on their bottom line.”

The report added that opportunities for growth are likely to remain constrained for the coming year, with the major threat being policy inconsistence and political risk. 

“Growth is likely to be hard to come by in 2013. Much depends on the state of Zimbabwean economy and the political landscape,” reads part of the report.

Foreign-owned banks in Zimbabwe, including Stanbic owned by Standard Bank Group [JSE:SBK], continue to work under constant threat of indigenisation from Indigenisation Minister Saviour Kasukuwere.

"I know you have heard a lot of things about banks, but we are not going back on banks," he said.

Zimbabwe’s central bank has however assured bankers and the banking public that the Reserve Bank of Zimbabwe (RBZ) was “the only authority that issued or withdrew banking licences from players in the Zimbabwean financial sector".

RBZ governor Gideon Gono has often reiterated that the government’s move to seize all foreign-owned banks under the country’s controversial indigenisation laws will have unintended consequences.

“Banking is a sensitive area which should be left alone. Indigenising those banks will make life more difficult for the people.

"The move will also make life difficult for me as the governor because when there are problems in the sector as a result of the indigenisation, people will point a finger at the central bank,” said Gono about indigenising banks.

 - Fin24
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