Gono urges banks to meet minimum capital requirements

The Reserve Bank of Zimbabwe says 6 out of 27 banks are yet to meet minimum capital requirements according to reports. The minimum capital requirements for banks is US$12,5 million, merchant banks and building societies require US$10 million each while finance and discount houses are required to meet a minimum capital requirement of  US$7,5 million each while asset management companies are at US$2,5 million.

Signs of sound corporate governance indicating the ability of the financial institutions towards meeting the provisions in the near future are also vital. Financial institutions are required to be adequately capitalised to cushion themselves against unexpected systemic adverse shocks with the underpinning capital acting as the dependable line of defence.

It is against this background that the Central Bank instituted measures that financial institutions should meet over a certain period of time with some banks having already met the minimum capital requirements while some are still struggling.

In an interview with the state controlled ZBC News, Central Bank Governor, Dr Gideon Gono said six banks are yet to meet minimum capital requirements, adding that the financial institutions have sound corporate governance structures which show that they will meet the provisions in the long-run.