Increased capital requirements 'will stabilise Zambia banking sector'

Jan 26, 2012

Zambia's banking sector will be stabilised by a move to increase the minimum capital requirements for investors planning to set up commercial banks, the former President of the Bankers Association of Zambia has claimed.

Zambia's banking sector will be stabilised by a move to increase the minimum capital requirements for investors planning to set up commercial banks, the former President of the Bankers Association of Zambia has claimed.

Sherry Thole said the move is a positive one as it will restore confidence to the industry, the Times of Zambia reports.

However, she warned the stricter rules will make it more difficult for Zambians who want to establish a bank, as it is likely they will need to "find partners or other sources of funding".

Under the changes, the Government has raised the minimum amount of money investors who want to set up a commercial bank must deposit with the Bank of Zambia, which has also conducted a workshop looking at issues surrounding wider foreign private investment in the nation.

Domestic investors must now deposit K104 billion (€15 million), while overseas investors require K520 billion. Ms Thole said a similar approach in Nigeria has helped stabilise the sector.ADNFCR-2976-ID-801276047-ADNFCR