Zimbabwe’s central bank chief has accused local banks of creating ”artificial” cash shortages by failing to collect money from the country’s main bank for distribution to clients.
”Notwithstanding the high levels of cash stocks sitting at the Reserve Bank ready for dispatch into the market, some banking institutions have been noted to be engaging in imprudent and unethical practices, which are creating artificial queues for cash,” Gideon Gono, central bank governor, told journalists and bankers in the capital, Harare, on Monday.
”This inability at some banks is primarily a result of such banks tying depositors’ funds in illiquid speculative investments in the stock exchange, real estate, motor vehicles, foreign exchange and other forms of non-core investments,” he added.
Last month, Gono threatened to expose high-ranking politicians and top business executives who he said were hoarding cash to buy scarce foreign currency on the burgeoning parallel market.
He said the central bank will ”not sit by and watch whilst banks use the fictional cash shortages as smokescreens shielding their unethical practices”.
”Blaming the government, the Reserve Bank or the governor all the time is unacceptable and will be met with serious consequences.”
Although Gono introduced new currency denominations, queues are still a common sight at banks across the country with depositors sometimes waiting in vain to withdraw their savings. — Sapa-AFP