adminJohn Chikura said speculative tendencies were a recipe for disaster.
“Most banks failed as a result of mismanagement and desire for rapid expansion,” he said.
“This is usually due to diversion from core business to speculative activities.”
Mr Chikura said market discipline was critical to instilling confidence in the banking sector.
“Every bank in the country should strive to publicise its financial performance at least twice a year. This in turn re-establishes confidence of depositors who are the key players in the banking industry,” he said.
He said banks should also offer incentives to enhance public confidence and stability in the financial markets.
“Currently, there is no interest on depositor funds when loans attract interest rates as high as 15 percent.
“That will continue to drive away depositors who will continue to circulate their money outside the formal banking system,” he said.
It is estimated that over US$2 billion is circulating outside the formal banking system.
The RBZ has since raised minimum capital thresholds for banks from US$12,5 million to US$100 million in a bid to stabilise the sector. — New Ziana.
Online Reporter
- Herald
- July 31, 2026
- 6 views
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