Zimbabwe: New Bill to strengthen corporate governance in the financial services sector
The Banking Amendment Bill has been transmitted for Presidential Assent.A new amendment about to be signed by the president of Zimbabwe Robert Mugabe is expected to strengthen corporate governance in the country's financial services sector.
The Parliament said last week that the Banking Amendment Bill, which seeks to address the weaknesses of the legislation which allow individuals to own directly controlling shareholding in banking institutions, has been transmitted for Presidential Assent.
According to the Herald, the new amendments include barring individuals from owning shareholding in a banking institution or in a holding company if the shares exceed 25 per cent of the total nominal value or the total voting rights of all the issued shares of the banking institution.
The new law will also enable the implementation of early warning systems, which will alert the authorities in case of breaches.
In addition, directors and senior executives in banks will now be exposed to lawsuits where it is proven that they acted recklessly or negligently. They can be liable to imprisonment for a minimum period of 10 years.