Gono Promises To Jail Errant Bankers

Gono who holds a position of disagreement between President Robert Mugabe’s ZANU PF and Prime Minister Morgan Tsvangirai’s MDC said he will push for amendments to cleanse the banking sector of unruly bankers who abuse depositors’ funds resulting in closure of banks.

He said he will implement new measures before his tenure at the apex bank expires in 16 months.

“Let me just promise you, as I have said elsewhere, I have 16 months to go to the end of the second term , any nonsense in the financial sector believe me you will go before I go. That’s my promise to depositors, I have no mercy, and I am not seeking to be reappointed. I can even go today but I will make sure before I go the banking sector of Zimbabwe will be as strong as no other point in its history,” Gono said at the central bank.

“Bankers are going to be disciplined as never before. If it means to put you in jail in order to make sure that your institutions are safe and sound I will do that. We shall be amending the banking sector legislation.”

The central bank increased minimum capital requirements for commercial banks from $12.5 million to $100 million among other increases to push for bank mergers as most banks are unlikely to be able to meet the new capital requirements.

Last week Royal Bank was closed after it faced liquidity crisis by failing to pay depositors their funds. The bank is currently suspended to allow the major shareholders to allow new owners who can inject capital before it can be placed on curatorship.

Gono is blamed for printing the local Zimbabwean dollar resulting in hyperinflation which ravaged the southern African country’s economy before the formation of the unity government by Mugabe and Tsvangirai in February 2009.

The position of the central bank chief was the centre of disagreement between the MDC and Zanu PF, with the premier’s party accusing Gono of running down the economy but Mugabe re-appointed him to his post.