The move buttresses Finance and Economic Development
Minister Professor Mthuli Ncube’s pronouncement last year of Statutory
Instrument 65 of 2020, which directed banks to pay interest on savings accounts
and fixed deposits.
The directive was issued to promote financial intermediation
and to stimulate production. However, banks were yet to observe the directive.
In a statement, RBZ Governor Dr John Mangudya said
following successful engagement with the Bankers Association of Zimbabwe (BAZ),
banks have complied with the directive.
“The bank wishes to advise the banking public that it has
engaged the Bankers Association of Zimbabwe on the need to comply with
Statutory Instrument 65A of 2020 on the payment of interest on savings
accounts,” he said.
“To this end, interest rates on deposits that shall be
offered by banking institutions, effective 1 July 2021 are as follows: savings
accounts minimum of five percent per annum on ZWL$, a minimum of one percent
per annum on US$.”
The Governor said fixed term deposits for ZWL$ will be paid
at a minimum of 10 percent per annum and a minimum of 2,5 percent per annum for
US$. There will be no bank charges on savings accounts and fixed term deposits.
The Apex Bank has also advised the public that demand and
call accounts were transactional accounts from which funds deposited can be
withdrawn at any time and without advance notice, hence in line with global
practice, banking institutions will not be able to pay interest on such transitory
deposits.
Prof Ncube is on record saying banks were charging high
transactional charges and lending rates, which means they could afford to pay
interest to depositors. Banks are supposed to pay an interest rate of not less
than 90 percent on Treasury Bills and at least 75 percent for individual and
corporates’ savings for a period of 30 days.
In the SI, the RBZ was also granted powers to determine the
yields of Treasury Bills and interest on individuals’ as well as corporate
balances.
In the 2021 Monetary Policy Statement (MPS), Dr John
Mangudya said the banking sector’s performance was satisfactory after it
recorded a $34,2 billion profit for the year ended December 31, 2020.
Banks also improved in the key risk and performance
indicators. As at December 31, 2020, total banking sector core capital of
$40,85 billion, reflected an increase of 94,08 percent, from $20,99 billion as
at June 30, 2020, mainly attributable to growth in retained earnings, bolstered
by revaluation gains from foreign exchange denominated assets and investment
properties.
Capital positions remain strong in the banking sector, with
average capital adequacy and tier 1 ratios of 34,6 percent and 22,7 percent as
at December 31, 2020, which were above the regulatory minimum of 12 percent and
8 percent, respectively. Chronicle
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