Addressing bankers in a low key mid-term monetary policy review statement where the media was barred, Gono said there would be no further extension of the deadline beyond December 31 2010.
Under the new capital requirements announced last year, by March 31, 2010, commercial banks were supposed to have had US$12,5m as minimum capital; merchant banks US$10m, building societies and discount houses US$7,5m and asset managers US$500 000.
“As at 30 June 2010, 17 out of 24 banking institutions, excluding POSB and the micro finance bank, were in compliance with the prescribed minimum paid-up capital requirements,” Gono said.
“The unqualifying seven institutions have been directed to either raise fresh capital from existing shareholders or bringing in new partners without any further delays. There will be no further extension beyond 31 December 2010,” Gono added.
Gono told bankers that the central bank is “on record advising the banking sector that Monetary Authorities no longer have appetite for curatorships”.
He added that as of June 30, 2010, 15 of the 16 asset management companies, had met the minimum paid-up equity capital of $500,000 effective 31 March 2010.
“Those with unrealistic initiatives were directed to merge their operations with stronger banking institutions, surrender their licences voluntarily or face involuntary liquidation,” the central bank chief said.
The first half of the year has witnessed the disposal of business units and rationalization of operations by some banks as they endeavour to realign their capital positions and business and activities.
NDH Bank sold its securities firm, NDH Equities, to a consortium led by banker Exodus Makumbe while MBCA disposed of its asset management arm to the same consortium.
NDH surrendered its banking licence when it became clear that the shareholders will not be able to raise the US$10m as minimum capital requirements.
For the second time this year, journalists were not invited for the presentation. In his policy review statement in January, Gono did not invite the media.