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Zimbabwe to inject $150m into RBZ

By Ndakaziva Majaka

HARARE – Finance minister, Patrick Chinamasa, said treasury will soon inject an additional $150 million into the central bank as part of efforts to recapitalise the financial institution.

RBZ Governor Dr John Mangudya talks to Finance Minister Patrick Chinamasa
RBZ Governor Dr John Mangudya talks to Finance Minister Patrick Chinamasa

“We have already capitalized the bank to the tune of $100 million, another $150 million is expected so that the bank can fully assume its role as the Lender of Last Resort,” Chinamasa told journalists yesterday at the official unveiling of the Reserve Bank of Zimbabwe (RBZ) board.

The treasury boss said the latest development was meant to complement the move by government to assume the $1,35 billion RBZ debt through the RBZ Debt Assumption Bill.

“We have been working very hard to restore confidence… the main reason why confidence had been lost was because we have been failing to honour our obligations. While we still cannot honour these obligations, I dare say we are in a better position.

“Now as the RBZ Debt Assumption Bill awaits presidential assertion, we can say we have worked hard to restore the central bank to its proper position,” he said.

The RBZ Debt Assumption Bill will see government assuming over $1,35 billion in debt on behalf of the central bank to clear the bank’s balance sheet and enable it to carry out its various roles as the apex bank.

Zimbabwe currently has a debt overhang of nearly $10 billion and civic society has called for a public audit before government assumes the debt, whose effects could be tax hikes. Experts assert that the central bank must first carry out an audit and liquidate its noncore assets before government assumes the debt.

Meanwhile, central bank governor, John Mangudya and Chinamasa unveiled the new RBZ board after the bank functioned for over a year without a board.

“I admit that it is poor governance for the RBZ to go for so long without a board but we were still conducting our due diligence processes in assembling the best team to do the job,” Chinamasa said.

The new board – chaired by Mangudya – include vice chairperson Rita Likukuma and eight other directors such as former Delta chief executive Joe Mutizwa, Virginia Mudimu, Aaron Maboyi, Michael Nyabadza, Onesime Mukumbe, Pauline Chapendama and Cornelius Maradza.

There are also going to be appointments from the ministry of Finance into the board. Daily News