President Edgar Lungu has said that his Government is concerned with failure by Commercial Banks to significantly reduce interest rates despite the Central Bank having lowered monetary policy lending rates to trigger the Banks to support Government initiatives.
Speaking today when he met Standard Chartered Bank Group Chief Executive Officer Bill Winters, in the company of Finance Minister Felix Mutati, Deputy Secretary to Cabinet Christopher Mvunga and Special Assistant to the President (Press and Public Relations) Amos Chanda, the president said that it was sad that his Government has not seen a significant interest rate reduction by Commercial Banks to support Government initiatives.
“Sadly we have not seen a significant interest rate reduction by Commercial Banks to support Government initiatives, which is a source of concern. The high interest rates charged by Commercial Banks have also resulted in increased non performing loan portifolios in the Banking sector.”
And the President hailed the cordial relations that exist between Standard Chartered Bank and the Zambian Government and that the visit by the institution’s Chief Executive Officer was testimony of this cordial relationship.
The President acknowledged the Bank as a strategic partner with a global reach hence Government is confident that the institution will continue as the country’s goodwill Ambassador in promoting Foreign Direct Investments (FDsI) into Zambia through its diversified clientele base.
“The country’s peace and stable political environment makes Zambia a natural destination for FDIs and this was evident in the ever-increasing pledges.”
The Head of State assured the bank that the country’s economic outlook in the medium to long term remained as positive and noted the recent upgrading of Zambia Credit Rating from negative to stable by Standard and Poor.
“GDP growth target for 2017 has been revised upwards from 3.6 percent to 4.3 percent with further gains anticipated. Inflation has dropped over the last 18 months from the high twenties to 6.3 percent. The Zambian currency has also remained stable.”
The President attributed the country’s good economic outlook to partly to Government’s austerity measures he announced on 26th November 2016.
“We are determined to press on with reforms aimed at fiscal consolidation, removal consumption subsidies and reducing bottlenecks that increase the cost doing business. Concerns about subsidies draining Government coffers have been addressed through cost- reflective tariff implementation on petroleum products and electricity migration from Fertiliser Input Support Programme to E-Voucher.”
The President also assured that negotiations with the International Monetary Fund were on a positive trajectory.
And Chartered Bank Group Chief Executive Officer Bill Winters assured President Lungu that on the occasion of the Standard Chartered’s 100 years of operations in Zambia, it was right and proper that the bank pledges to do more to create greater partnerships with the government and the private sector in Zambia.
“Zambia is a special place for us and we are to stay. We have been here a 100 years and we appreciate greatly what we have achieved in Zambia” Mr. Winters said when he led the bank’s delegation to pay a courtesy call on the President at State House on Tuesday evening.
“We will address Your Excellency’s concern that we are not doing enough to lend to agriculture. There is a way we can help to attract capital to help commercialise the agriculture sector in Zambia as we have done in Nigeria where we mobilised investors from Japan.
During the same meeting Standard Chartered Zambia Chief Executive Herman Kasekende announced that the bank will build its new head office at a new location near Addis Ababa Roundabout.
Others who accompanied the Group CEO are Standard Chartered Zambia chairman Mr. Michael Mundashi, Standard Chartered Regional CEO for Africa and Middle East Mr. Sunil Kaushal and Mr. J. Kweku Bedu-Addo, the CEO for Southern Africa.
“President Lungu saddened by Commercial Banks’ Ah the helicopter man, that is nothingfailure to significantly reduce interest rates”
Ba LT, Please straighten out the above Heading before I can read further
GREAT MAN is Mr Lungu
Press GREEN for Lungu
Red for HH
Thanks
BB2014,2016
Just fire Mutati if he is a threat in 2021. Instead of embarrassing him with friends in commercial banks.
Two thinhs Mr. Drunk:
1. Banks understand the dollar-kwacha value is not economically backed, it is doctored…
2. The banks in Zambia have been made so fool!sh by you same politicians. See, the bank first gets your fckn money, and then begin to charge you monthly for keeping your money, and then charges you everytime you need part of it through a withdrawal on the cash machine, and charges through swiping…So what kind of rubbish is that>>??In UK, money withdraw on cash machines is free, because the bankers know its your money.
Two things Mr. Drunk:
1. Banks understand the dollar-kwacha value is not economically backed, it is doctored…
2. The banks in Zambia have been made so arrogant by you same politicians. See, the bank first gets your only money, and then begin to charge you monthly for keeping your money, and then charges you everytime you need part of it through a withdrawal on the cash machine, and charges through swiping…So what kind of rubbish is that>>??In UK, money withdraw on cash machines is free, because the bankers know its your money.
If you have a loan with SCB Zambia Ltd will understand what the president is talking about.
Despite GRZ efforts through BOZ to improve the economy the bank has not significantly responded in reducing interest rates.
If these banks fail, the effect is too grievous to contemplate. Look at USA regulations to know how to deal with these issues. The Govt needs to use fiscal policies instead of talking to have meaningful economic change. I doubt ECL knows what he was saying, including his team.
Mr President, perhaps if you stayed in the country more rather than globetrotting you would understand the problems facing the country a little better
Economy has stabilized in the ‘negative’ … I have a DHP thanks
ECL thinks talks change things. He does not know that actions are the ones that effect change. Why say this when meeting one bank. Such cry baby statements are supposed to be discussed at Zambia Economic Forums or Financial Meetings with all stakeholders.
See,
you are the only one blogging sense. The rest don’t have loans with Standard Chartered. That is why the president has chosen to speak to the Stanchat CEO. Last year stanchat increased the rates and the return period for all loans by a year on the pretext that BOMA had in increased the reserve ratios but but they are dragging their feet that reserve ratios have been reduced.
You are the president and if you just lament without action then you are but a crying baby. Please take practical action Mr President. I know your ability sir, we have been abused too much even by the banks where the government are share holders such as NATSAVE and Zanaco to say the least.
At least for once, lets praise our president for saying something that is at the hearts of many suffeing zambians. Banks in zambia are monisters that are there to chock us the suffering masses that are keeping these monister banks in business without them giving us anything to appreciate.
They rush to take poor zambians to another monister called CRB without understanding the circumstances under which the loan turned into a non performing.
My hope is that our equal to task performing Minister of Finance will try to put regulations under which a non performing loan can be listed with CRB not the today underhand methods
If the president acts then Hachilema will jump and say you see, I have been telling you that he is a dictator. So in a mature democracy like ours the president knows that he has to express his opinion and those concerned must act accordingly and not to be pushed by a head of state. It is called ” abuse of power” So ECL is smart enough not to traverse such territories while remaining relevant as a head of state. In a nutshell that is what is at stake. It is actually true what the president is saying. In most countries using monetary policy the Banks maintain a small margin between reserve bank lending rate and the their prime rates. This allows the Govt or the reserve bank to control the inflation and manage inflationary pressures in the economy. Just thinking!!!
President Lungu saddened by Commercial Banks’ Ah the helicopter man, that is nothingfailure to significantly reduce interest rates ….PLEASE WITHDRAW THE ARTICLE WE EMBARRAS OURSELVES TO THE WORLD
Just don’t comment if you are UPND, you embarrass us to the world!
Do not worry. No body can beet PF in creating global embarrassment. Starting with having President who is convicted embezzler to having abdicated rule of law. Relax, PF is the greatest embarrassment ever happened to Zambia.
How can he be saddened whan the government have been active in issuing treasury bonds at handsome rates,influencing commercial bank lending rates.And there by crowding up monetary resources that can go far to help influence private business growth.
This poor ignoramus is too dull to understand one simple fact – IT IS GOVERNMENT BORROWING THAT IS PUSHING UP INTEREST RATES SO HIGH!
Lungu, get your own house in order and the interest rates will AUTOMATICALLY go down. YOU are responsible for the high rate by PF Government financial incompetence and indiscipline!
Really laughable..i remember this Lazy Bum had a meeting with Bank Managers last month..he thought they will be his drinking friends like Kaizer. You saddened because you are too lazy to sit down and work for a change…who do think is going to trust you? You lied about invoking article 31 to them and no arrests so far.
Why has Lungu spoken on interest rate reduction without first finding out the facts with Bank of Zambia? Does Lungu understand Banking Technical Terms like Cost of Funds, Spreads or margin? Banks cannot reduce interest rates below the Cost of Funds becoz they will be operating at loss. Banks are a business so they have to operate profitably.
@ 7 you reason like those monister banks we have in zambia
The most illiterate and dull mind in the world -JayJay! Soryy, HaJayHJay.
Reply directly to him so that your post falls under his thread. You are now blogger number 8 trying to tease blogger number 6. So chiVictor, who is dull between the two of you?
Victor get serious with life. The only problem Zambia has is incompetent Lungu so stop calling others dull and use that energy to travel Zambia and educate Zambians on the importance of thinking before you vote
Bwana Lungu you come across as a kantemba type clueless economist.
He went to Swaziland to waste tax payers money and now he wants to serve his face by pretending that he care about a common. The guy doesn’t know how to run a country .
He went to Swaziland to waste tax payers money and now he wants to serve his face by pretending that he care about a common man . The guy doesn’t know how to run a country .Let him pay up for illegally overstaying in government as per judgement by the Con court .
UP AND DOWN CADRES, BUILDING AN ECONOMY IS NOT DOWN BY ECONOMISTS. IT IS DOWN BY THE SWEAT OF HARD WORKING MEN AND WOMEN