Zimbabwe Banker’s Association Wants Clarity on Monetary Policy

Zimbabwe’s bank association, whose members include the local units of Barclays Plc and Standard Chartered Plc, said the central bank should explain how it will resume its role as lender of last resort.

The country needs a monetary policy statement that will “give definitive terms of how the lender of last resort will function,” the Banker’s Association of Zimbabwe said in a document obtained by Bloomberg News.

Zimbabwe, which has no domestic currency, uses mainly dollars for trade. The South African rand, Botswana pula, euro and British pound also became legal tender alongside the dollar in February 2009, when the Zimbabwe dollar was abolished. At the time, inflation reached 500 billion percent, according to the International Monetary Fund, and shop shelves were largely empty.

Lenders also want a monetary policy that clarifies banks’ minimum capital requirements, according to the association document, which adds that existing requirements should be “scrapped.”

Commercial banks should also have access to banking platforms established by mobile phone companies for the customers, said the document. Zimbabwe should also establish credit bureaus to help counter the rise in non-performing loans, it said.

Cash Depository

Zimbabwe’s central bank should resume its role as the central depository of cash for lenders and to deal with the “importation and repatriation” of cash so banks may benefit from “economies of scale,” the association said.

Banks also want a derivatives market to be created to increase the products they offer customers, according to the document.

Calls to the association weren’t immediately answered. The southern African nation’s central bank will present its monetary policy document tomorrow, the bank said.

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