Zambia 2017 | FINANCE | COLUMN

TBY talks to Leonard Mwanza, CEO, Bankers Association of Zambia, on the sector.

Leonard Mwanza

How does the Bankers Association of Zambia operate?

The Bankers Association of Zambia is an industry-based organization that represents the interests of all commercial banks licensed by the Bank of Zambia. It is compulsory for all registered operating commercial banks to be members of the Bankers Association of Zambia. Our main functions are to advocate for policies that are favorable to the well-being of the industry and mediate between the public, the banks, and the regulators in order to enhance economic development. We lobby for consumer protection and system development, working on efficient payment platforms in line with modern necessity. Our advocacy relates not just to policy, but also to system reliability, integrity, enhancement, and innovation.

What are the main challenges currently facing Zambia's banking sector?

In 2016, economic activity was flat. This translated into the banking sector having flat loan books emanating issues of constrained liquidity. We entered 4Q2015 with harsh monetary policies, and increases in the exchange rate; all measures to control inflation. The objective was reached, but in doing so the cost of new deposits skyrocketed, sometimes as high as 35% over the course of 2016.