RBZ Revokes Capital Bank's Licence


News: On June 5, the Reserve Bank of Zimbabwe (RBZ) revoked the banking licence of Capital Bank. The cancellation of Capital Bank's licence could fuel additional negative sentiment about the stability of indigenously owned banks in Zimbabwe. The key reason for the cancellation was undercapitalisation. Major shareholder of Capital Bank the National Social Security Authority is no longer keen to inject further capital into the bank. The cancellation will be in the best interests of creditors, depositors and members of Capital Bank, according to a statement by the RBZ. 'The bank has been operating in an unsafe and unsound financial condition, characterised by critical undercapitalisation, persistent losses, chronic liquidity challenges and inordinately high non-performing loans,' the RBZ said (BDlive). Capital Bank joins a string of local lenders that have failed over the years including Genesis Bank, Royal Bank and Trust Bank.

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Geography: Zimbabwe

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