THE Reserve Bank of Zimbabwe (RBZ) has stopped accepting new applications for asset management companies, dampening new entrants’ hope of investing in the lucrative financial industry. <
Presenting the second quarter to June 30 monetary policy statement this week, RBZ governor Gideon Gono said as at June 30, 57 applications for asset management companies were received and only 23 were licensed while eight were rejected. Seven applicants withdrew on their own while 19 were at various stages of the vetting process.
“We do not have much appetite for more applications this year and for the greater part, thereafter,” Gono said.
For insolvent asset management companies and licence applications that have been rejected, Gono said, an Exit Policy and Procedures had been formulated to ensure that the companies left with “minimum or no disruption to the financial sector”.
“The Exit Policy and Procedures also provide for an orderly exit of the operational asset management companies that fail to comply with regulatory requirements,” Gono said. On micro-finance institutions, Gono said a total of 168 applications, which are at various stages of the vetting process, had been received by June 30.
Gono, however, lamented that the bulk of the applications for micro-finance and money lending licences had “serious deficiencies including inadequate capitalisation, substandard corporate governance structures, rudimentary financial projections and limited documentary evidence on such critical compliance requirements as tax clearance certificates”. Against this background, Gono said, the central bank, in association with the Zimbabwe Association of Microfinance Institutions (Zamfi), had conducted road-shows countrywide to educate applicants on the registration requirements.