‘Prosecute errant bankers’

via ‘Prosecute errant bankers’ January 24, 2014 in Business NewsDay

A PARLIAMENTARY Portfolio Committee on Finance and Economic Planning has urged government to prosecute and effect stiff penalties on bankers and shareholders responsible for bank failures.

The chairperson of the committee David Chapfika said lawmakers were concerned with the frequent bank failures and troubled banks due to poor corporate governance and corruption.

“Issues of poor corporate governance remain endemic within the banking sector, with insider loans to directors and shareholders continuing to be pervasive and having resulted in the loss of public confidence in the banking sector,” he said.

“It is the committee’s view that culprits responsible for bank failures as a result of unethical practices be prosecuted.”

Chapfika said Treasury should closely supervise the central bank’s role on the banking sector in order to protect depositors’ funds.

“There is need for government to assist indigenous banks, which are currently receiving the same treatment as big banks, so that we do not continue to witness the reversal of the indigenisation policy in the banking sector,” he said.

The central bank cancelled the licence of Trust Bank Corporation last year due to the abuse of depositors funds by management and efforts to rectify the problem were fruitless.

Trust Bank was closed with a core capital of $1,9 million after recording cumulative losses of $18 million since its inception.

Some of the banks that are no longer operating include Royal Bank, Barbican and Genesis Investment Bank.

Official documents from the Reserve Bank of Zimbabwe have shown that seven banking institutions were being monitored under the Troubled and Insolvent Bank policy. Among the banks were Allied Bank and Metbank.

The official documents have shown that 15 banking institutions were profitable for the nine months ending September 2013 excluding POSB and losses that were registered at some banking institutions have affected the respective banks’ capital positions.

Financial institutions were faced with high non-performing loans which were likely to persist if the economy remains sluggish, the document has shown. The central bank said the average ratio of non-performing loans to total loans stood at 15,64% as at September 30 2013 from 14,15% as at end of June 2013.

Meanwhile, the committee said the proposed central bank assumption of debt was a good initiative, but there was need for transparency on these issues that impose a huge burden on taxpayers.

“The committee is, therefore, recommending to the Finance and Economic Development minister that information regarding the specific creditors making up $1,35 billion be made public to ensure that there is more transparency and accountability with respect to this debt-assumption exercise,” Chapfika said.

 

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3 comments on “‘Prosecute errant bankers’
  1. chapfika is not the right person to tell us about corruption in banking sector. he is the pioneer of corruption in banking sector. Remember his bank Unibank

  2. easily fooled says:

    Treasury to supervise the Bank Supervision department? Uri chapfuka zvedi. The role was given to bank supersion of RBZ because of lack of skill in the Treasury. I remember the error of the “mashroom of bank supervision”. I was amongst the first 12 trained bank examiners in 2000.

    These bank examiner with the kind of training they get; they really produce high quality independent reports based on the minimum expectation of the Bank of International Settlement (Basle). But what happens? Some of the recommendation are never implemented bcoz the banks are connected. The two examples of failed banks that always had “waived” recommendation are Unibank owned by Mr. DAVID CHAPFIKA and Genesis which had the had of Sevhiya Kasukuwere (cant say saviour to this kind of man)

    As Doctor Gideon Gono once said, Dr Mr Chapfika cant have Solomonic wisdom on this subject.

  3. Throw all of them including enuck kamushinda James makamba chanikira mpofu kasukuvere chapfika kaukonde mthuli ncube so so so many bogus banksters who enriched themselves. Remember gono that treason carries a death sentence. Into thesnakepit at our new chikurubi

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