Don't attach debtors' property, RBZ tells banks

RBZ Governor John Mangudya says banks must not attach defaulting debtors' properties, but restructure bad debts instead.

This comes on the back of a wave of property auctions and seizures by bailiffs, as banks- burdened by ballooning NPLs estimated at around $700million- are increasingly attaching defaulters' assets to recoup loaned funds.

Mangudya said the institutions must adopt "a different approach" in dealing with the bad loans. His argument is premised on that it will not help the banks that after liquidation they get half of the money they are owed, while restructuring the loans would see the banks recovering the bulk of the monies owed as it gives defaulters more time to pay.