THE Bankers Association of Zambia (BAZ) says banks in the country are struggling to support key sectors of the economy because they do not have enough funds. BAZ President Leonard Mwanza says the recently increased statutory reserve ratio empowers the central bank to be entitled to as much as 18 percent of all deposits made in Banks. THE Bankers Association of Zambia (BAZ) says banks in the country are struggling to support key sectors of the economy because they do not have enough funds.
BAZ President Leonard Mwanza told the Lusaka Star in a telephone interview today that the recently increased statutory reserve ratio empowers the central bank to be entitled to as much as 18 percent of all deposits made in Banks.
“In simple terms, this means that for every 100 Kwacha deposited, the central bank is entitled to 18 Kwacha,” he revealed.
Mr. Mwanza noted that due to the increase in the ratio, the interest rate for most banks will be affected.
He further explained that the increase in the ratio means that the Central Bank detains a larger portion of the money deposited in Commercial Banks which leaves the banks with less financial reserves.
“You will find that there are many projects that have to be ventured into but because of lack of money, these have to be put on hold,” he said.
The BAZ President emphasized that the association is currently engaging the Bank of Zambia and various stakeholders to ensure that the interest rate ratio on the market is normalized.
Mr. Mwanza explained to Lusaka Star that normalising the situation was the only option as maintaining high rates would disturb the operations of banks in the country.
“If the situation is not handled, it may have a negative impact on other parts of the economy,” he added.
Mr. Mwanza said banks make most of their profit from lending adding that high statutory reserve ratio could cripple operations of these banks.
“To lend money, we should have excess ourselves but the high state reserve ratio means we have less money,” he explained.
The BAZ President has cautioned that disturbing the operations of banks in the country would lead to a huge economic regression.
The statutory reserve ratio was earlier this year increased from 14 percent to 18 percent.
ZANACO OPEN A THREE LEAD IN MTN/FAZ SUPER LEAGUE
Zanaco Football club has continued occupying first position on the MTN/FAZ Super league table after recording their third back to back victory with Real Nakonde being their latest casualties in Week 32 round of matches played between yesterday and Tuesday 24th October.
Zanaco’s Heritier Nkonko was first to find the back of the net for the bankers against Real in the 36th minute while a 69th minute second-half goal by Felix Nyaende condemned Real Nakonde to their 20th loss of the season.
Meanwhile, Second placed Green Buffaloes yesterday played to a zero zero stalemate with Lusaka Dynamos while Kitwe based Power dynamos on Tuesday managed to salvage a one all draw against their copperbelt rivals Zesco United.
And Nkana yesterday thrashed Nkwazi by two goals to zero in a thrilling match played at Nkana stadium with Striker Ronald Sate Sate Kampamba scoring in the 26th minute through a Harrison Chisala assist.
Nkana continued to search for a second goal and their efforts were rewarded as left back Dieugo Apanane's ferocious goal from a free kick in the 85th minute pushed the Kitwe based to fourth position on the table.
This means Zanaco still seat in first position with 60 points from 32 games played while Green Buffaloes trail the bankers in second place with 57 points from 32 games.
Zesco united are in third position with 56 points and two games in hand while Nkana occupy fourth position on 55 points after 32 games played.
At the bottom of the table in relegation waters is City of Lusaka seating on 20th position after recording their 24th loss of the season from 31 games, while Mufulira Wanderers, Konkola Blades and Real Nakonde occupy 17th, 18th, and 19th positions respectively.
THE FAZ/MTN SUPER LEAGUE TABLE AFTER WEEK 32 ROUND OF MATCHES
WEEK 32 FULL RESULTS
Zesco 1-1 Power Dynamos
Lumwana Radiants 0-1 Napsa Stars
Nkana 2-0 Nkwazi
Zanaco 2-0 Real Nakonde
Konkola Blades 1-2 Red Arrows
Mufulira Wanderers 0-0 Choma Eagles
Nchanga Rangers 1-0 Buildcon
Green Buffaloes 0-0 Lusaka Dynamos
City of Lusaka 0-1 Kabwe Warriors
Nakambala Leopards 0-0 Forest Rangers ... See MoreSee Less