Mission
The mission of the Bank of Zambia is to formulate and implement monetary and supervisory policies
that achieve and maintain price stability and promote financial system stability in the Republic of Zambia
ZAMBANKER
A Bank of Zambia Journal
Zambia's copper earnings
exceed US $2.5bn
By Zambanker reporter
Zambia has recorded an
increase of over 100 percent
in copper earnings in the first
half of 2010 in comparison
with the same period last year,
hitting the US $2.5bn mark.
Bank of Zambia preliminary
data show that the country's
earnings from copper sales in
the first half of this year
First Republican President Dr. Kenneth Kaunda paid a visit to the Bank of Zambia stand at the Lusaka Agricultural and Commercial Show. Above, Bank
'Help us promote public welfare'
By Zambanker reporter
The Bank of Zambia (BOZ)
has appealed to Members of
Parliament to continuously
create conditions that
uphold the implementation
of policies aimed at
advancing public welfare.
The Bank adds that such
conditions would help to
create a climate for
consistency among
monetary, exchange rate,
fiscal and structural policies.
Speaking during
deliberations of the BOZ
2010 MPs seminar in
Siavonga, Bank of Zambia
Deputy Governor-
Administration, Dr. Tukiya
Kankasa-Mabula said
providing the central bank
with the right to be
consulted about legislation
exceeded US $2.5 billion, with
the rise being attributed to
increased copper prices on the
international market and
improved output.
Most of the existing mining
companies increased their
output of copper while new
players in the copper
business, like Lumwana
Mining Company, added to the
staff pose for a group photograph with Dr. Kaunda in the BoZ stand
affecting it would reduce the
risk of a new law potentially
harming and restricting the
ability to achieve its mandated
objectives.
“Most importantly, such
consultative rights would
specify that we are
continuously involved in
decisions in the financial
system, even when the
decisions are made by others,”
she said.
Dr Kankasa-Mabula explained
that although the powers and
responsibilities of the BOZ
were constituted under a
specific piece of legislation, its
powers and responsibilities
may be affected by other laws
including constitutional
provisions, hence its appeal
for Members of Parliament to
consider the implications that
increased production.
Zambia earned about US $2.5
billion from copper exports in
the first half of this year
compared with the US $1.2
billion earned in the same
period last year.
Data obtained from the
Economics Department of the
Bank of Zambia show that the
price of copper in the first half
the laws they enact would
have on its objective to
promote public welfare.
She explained that BOZ laws
codify the roles and
responsibilities, set out
objectives, specify the degree
of independence and establish
the nature of the central
bank's accountability. She said
the laws also specify the
powers of the central bank,
including the power to enter
into transactions and take
administrative actions such as
issuing regulations and
levying charges and fines.
Dr Kankasa-Mabula added
that the laws also determined
the central bank's relationship
with the government and its
degree of autonomy.
“The independent authority to
run monetary policy can be
SEPTEMBER 2010
of this year averaged US
$6,571 while in 2009 the
average price of the mineral in
the corresponding period was
US $3,720.
Copper production also rose to
393,309 metric tonnes (mt) in
the first half of 2010
compared with 339,309
tonnes produced in the same
period last year.
compromised or nullified by
decisions on other areas of
economic policy.
First, exchange rate policy
decisions can significantly
constrain options for
monetary policy,” she said
She said that reforms of
m o n e t a r y p o l i c y
arrangements were
essentially designed to
enhance the central bank's
ability to maintain price
stability, but may not always
have been accompanied by
reforms that bring greater
discipline to fiscal policy.
Dr Kankasa-Mabula stated
that financial system stability
would, consequentially, result
from the broad social and
intellectual consensus that
low, stable inflation provides
To Page 5
“Stop HIV/AIDS,
Keep the Promise.”
The first-half yearly copper
output in 2010 puts the
country on course to hit its
annual target of 750,000mt.
In the first half of this year, the
country exported 392,334mt
of copper compared with the
311,933mt exported during
the same period in 2009.
Commenting on the
development, BoZ Assistant
Director - Macro economic
Analysis Division in the
Economics Department, Dr
Francis Chipimo said the
country was on course to
produce more base minerals
this year compared to 2009.
Dr Chipimo said increased
output resulted from the
resumption of operations by
most mines while new mines
were to ramp-up production
in view of increasing
international copper prices.
He said resumption of
operations at Chambishi
Copper Smelter, the country's
Interest rate determinants revealed
By Zambanker reporter
The Bank of Zambia has
revealed that the regulatory
cash reserve requirements,
which include the statutory
reserve ratio, core liquid asset
ratio, the weighted average
deposit rate and taxation, were
some of the common factors
that banks take into account
when determining base
lending rates.
Acting Director - Economics Dr
Emmanuel Pamu revealed
these results at a workshop
hosted to disseminate results of
a survey conducted to identify
qualitative and quantitative
factors that commercial banks
consider in making decisions
regarding their base lending
rates at Taj Pamodzi Hotel in
Lusaka recently.
Other factors which were
considered significant in the
determination of base lending
rates were treasury bill and
GRZ bond yield rates, operating
costs, return on equity and the
cost of non-performing loans.
Qualitative factors that were
highlighted included credit risk
premiums due to large
information asymmetries and
the high default culture, as well
as the demand and supply for
credit and industry trend in
base lending rates.
The Bank of Zambia embarked
on a research to assess the
feasibility of an interest rate
targeting framework in the
INSIDE THIS ISSUE
Stakeholders examine draft BoZ Act
Northern region tours continued
Develop payment systems, urges Fundanga
FINSCOPE 2009 Survey Completed
SADC ICT gurus look ahead
Consistent Performance vital - Kankasa-Mabula
Zambia attractive investment location-Chinese bank Page 8
Kalyalya commends BSA
BoZ Madalas discover a winning formula
Dr Chipimo
biggest cobalt plant, and
increasing output at Lumwana
Mine were expected to prop up
metal productions this year.
conduct of monetary policy
following Government's
intention to shift the conduct of
monetary policy from monetary
aggregate to interest rate
targeting as announced in the
2010 budget.
As part of the research, a survey
was undertaken with the aim of
understanding the interest rate
decision-making process in
Zambian banks. Understanding
of the banks' interest rate
decision-making process was
expected to assist the Bank in
the determination of an
appropriate policy rate and in
ascertaining the transmission
channel through which the
policy rate would be most
effective.
Understanding why lending
interest rates were high in
Zambia was also an issue of
great policy interest.
Dr Pamu pointed out that the
survey results showed that only
one bank took the interbank
rate into account when
deciding on what rate to set,
while four banks indicated that
the BoZ overnight facility rate
was taken into account.
Only half of the banks surveyed
considered inflation explicitly
in their determination of base
lending rates, although some
banks indicated that inflation
was taken into account when
calculating real returns. The
Director, however, pointed out
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Stakeholders examine draft BoZ Act
Participants of the stakeholders’ workshop pictured following deliberations attentively
By Zambanker reporter
The draft Bank of Zambia Act
has been finalized and
presented to various
stakeholders for further
review before submitting to
the Ministry of Finance and
National Planning for the
BOZ Board gets new members
Dr Musokotwane
By Zambanker reporter
The Minister of Finance and
National Planning, Dr
Situmbeko Musokotwane has
appointed Senior Chief
I m w i ko A n a n g ' a n g a o f
Lukulu, Western Province as
a member of the Board of
Directors of the Bank. In his
letter of appointment to
Senior Chief Anang'anga, the
Minister said the new Board
member shall be responsible
for the formulation of policy
and will contribute to the
general administration of the
Bank under Section 9 (1) of
Cap 360 of the Laws of
Zambia.
The Minister hoped that the
Senior Chief would
unreservedly discharge the
functions and live up to the
challenge.
“Pursuant to the powers
A BANK OF ZAMBIA JOURNAL
legislative process.
Deputy Governor –
Administration Dr Tukiya
Kankasa - Mabula said the
Bank had embarked on a
process of reforming and
modernizing its legislation
relying heavily on the SADC
Senior Chief Imwiko Anang'anga
bestowed upon me, I have
decided to appoint you as
Director of the Bank of Zambia
Board of Directors” he said.
Senior Chief Anang'anga is the
first ever traditional leader to
be appointed Director of the
Bank of Zambia Board since its
establishment. Among the
numerous qualifications, the
Senior Chief is a holder of a
post graduate diploma in
agriculture development from
the University of London, a
diploma in Trade Promotion
and Export Marketing from
Helsinki School of Economics,
a diploma in Agricultural
Business Management from
the Mananga Agricultural
College in Swaziland, and a
diploma in Cooperative Theory
and Practice from the Plunkett
Foundation, Oxford University.
He is also a member of the
NEWS
Central Bank Model Law but
mindful of the fact that
provisions had to relate to the
local circumstances.
Dr. Mabula said this when she
officially opened the
stakeholder's workshop on the
draft Bank of Zambia Act held
Institute of Administrative
Accounts, formerly the
Institute of Book Keepers. This
is a professional accounting
course for three years at
Evelyn Hone College. He
further has a Cambridge
School certificate from St
Johns Secondary School in
Mongu and he completed his
earlier education at Lukulu
Primary School.
In terms of work experience,
Senior Chief Ananag'anga
worked for the Western
Province Cooperative Union
(WPCU) as General Manager
from 1983 to 1993. He further
worked for the Produce and
Projects Division at Namboard
Headquarters as Deputy
Divisional Manager from 1975
to 1979, after which he went
on to work for Zambia
Horticultural Products Limited
2 ZAMBANKER SEPTEMBER 2010
at Mulungushi International
Conference Centre on 21st
September 2010.
The workshop was attended
by representatives from
financial service providers
whose operations stand to be
affected by the administration
Dr Chiwele
as Marketing Manager from
1979 to 1983.
Other posts of note that the
Senior Chief has held
include being Provincial
Manager at Namboard in
Monze, Provincial Produce
Supervisor at Namboard
based in Ndola and Assistant
Accountant at Namboard in
Lusaka.
And welcoming the Senior
Chief to the Bank of Zambia
family, Bank Governor Caleb
Fundanga congratulated the
Senior Chief for the
appointment and trusted
that he would assist the
Bank to provide the vital
leadership as expected of the
Board in the maintenance of
price stability and in the
strengthening and
development of the banking
To Page 8
of the act, representatives
from Government ministries,
other regulatory entities and
professional bodies
representing lawyers,
accountants and economists
as well as BoZ representatives
who will administer the act.
The Deputy Governor –
Administration mentioned
that the Bank had initiated
law review to the current
central bank legislation to
respond to the demands of the
era. The exercise resulted in a
'home grown' draft Bank of
Zambia Act.
She was pleased to report that
the draft had incorporated
principles of international
best practice.
The 2002 joint IMF and World
Bank assessment of Zambia's
financial sector under the
Financial Sector Assessment
Programme (FSAP) raised
awareness of various
weaknesses in Zambia's
financial system which
needed to be addressed. For
this purpose, the Government
approved the establishment of
the Financial Sector
Development Plan (FSDP) to
address these weaknesses
a n d i m p l e m e n t
recommendations. One of the
recommendations adopted
was the need to modernise
and harmonise financial
sector legislation which
included the BoZ Act.
The other reason that
precipitated the need to have
the Act reviewed was the task
given to the SADC Committee
for Central Bank s (CCBG) to
develop harmonised
legislation for SADC Central
Banks.
Zambia being a member
country participated in this
process which led to the
creation of a Central Bank
Model Law.
Member countries were
expected to domesticate the
provisions of the Model Law
which enshrined three pillars
BoZ donates to
Kalabo High School
By Nimon Muleya
The Bank of Zambia (BoZ) has
re-iterated the need for
adequate investment in the
education sector if sustainable
economic development is to
be made possible.
A n d We s t e r n P r o v i n c e
Permanent Secretary Seth
Muleya has called for public
private partnership in order to
assist Government in meeting
the Millennium Development
Goals (MDGs)
Bank of Zambia Head of Public
Relations, Kanguya Mayondi
said BoZ attaches great
importance to education as a
tool to achieving economic
development.
Mr. Mayondi said this when he
presented a donation of 89
mattresses to Kalabo High
School.
“The idea of giving hope to our
current crop of pupils today is
very important, to a point
perhaps that can not be over
emphasized. Education is an
important thing. We all would
not be here speaking foreign
languages if it had been not
for education.” he said.
of central banking and these
being independence,
accountability and
transparency.
Some of the outstanding
features of the draft Act
include the institutional
arrangements of the Bank
including the appointment of
governors, directors and
auditors, internal budgets,
reports, reporting
requirements, preservation of
confidentiality and handling of
possible offences, adequate
mechanisms for good
governance and security of
tenure for governors as well as
provisions relating to
adequate power and
independence.
The draft Act also looked at the
application of monetar y
policies, including the role of
lender-of-last-resort, interest
and exchange rate policies,
and Bank of Zambia's
involvement in money and
foreign exchange markets.
Dr Kankasa-Mabula said the
Bank tabled the draft Act
before stakeholders to
maximise its consultative
process by taking into account
all views on the layman's draft.
She further encouraged
constructive debate and
assured all stakeholders that
their views would be taken
into account before the draft
could be transmitted to the
Ministry of Finance and
National Planning.
'Therefore I call upon all
participants to openly debate
this draft Act and share
opinions which the Bank can
benefit from in its effort to
develop a comprehensive law,'
she added.
After submitting to the
Ministry of Finance and
National Planning, the
Ministry would be responsible
for initiating the legislative
process that shall see the
layman's draft transformed
into a Bill and tabled before
Parliament for debate.
Mr. Mayondi appealed to the
public not to relent in
ploughing back into the
community that initially
assisted them to be whom
there were today.
Meanwhile, Former Kalabo
Secondar y/High School
Pupils' Association
(FoKaSHA) chairperson
Mundia Nalishebo said his
association is committed to
mobilizing resources for
their former school.
Mr. Nalishebo pledged that
his association is geared to
do many other things in
order to help their former
School, Kalabo High School.
“We're looking back and
want to give back to our
school. Firstly, we want to
get the very things that
would give hope to the
current crop of pupils at
Kalabo High School.” he
said.
Mr. Nalishebo appealed to all
former Kalabo High School
pupils in the country to join
his association and assist in
improving the status of the
To Page 6
 News

Northern region tours continued

By Zambanker reporter
Director Regional Office Mr
Morris Mulomba, who has
been conducting tours of
commercial banks serviced by
Regional Office, recently took a
tour of banks in North-Western
province. Among the banks
visited are Finance bank in
Mwinilunga and seven other
commercial banks in Solwezi
which included Standard
Chartered bank, Barclays
bank, Investrust bank,
Cavmont Capital bank, Finance
bank, Zanaco and Stanbic
bank.
Mr Mulomba who was in the
company of Senior Inspector
Compliance Mrs Margaret
Siwale and Protocol Officer Mr
Lombe Mulanda also visited
Kansanshi mine and paid a
courtesy call on the provincial
administration.
During a courtesy call at
Cabinet Office, the Deputy
Permanent Secretary, Mr
Nkolola Hazemba stressed the
need to have more commercial
bank branches opened in the
province especially that the
economy was doing well. The
opening of Kansanshi and
Lumwana mines had brought a
lot of economic growth in the
area.
'There are still a lot of business
opportunities in the area but as
you can see all around Solwezi,
we do not even have a Bureau
De Change,' he said.
However, Mr Hazemba was
happy with the number of
commercial banks in Solwezi
and the various products they
were offering which he said
had really empowered the
people of Solwezi. He added
that he was happy with the
loans people were getting from
the commercial Banks and he
hoped that they were putting
them to good use. Mr Hazemba
added that the newly
introduced salaried loans were
very popular among civil
servants who were busy
constructing houses.
Nonetheless, the Deputy
Permanent Secretary said it
was very saddening to see
some banks operating in what
he termed as “illegal
structures”. He said he wanted
to see banks take up the
responsibility of putting up
serious structures. Mr
Hazemba mentioned that it
was sad to see some banks
operating in shop-like
structures or containers. He
urged the Bank of Zambia to which he said were doing agreement that a few of the promise will be communicated the Bank of Zambia and also to
look into the issue seriously as relatively well. 'I am also in banks need a facelift which I to the proper authority within the banks,' Mr Mulomba added.
it was not reflective of the kind
of development people wanted
to see in Solwezi and the
Province as a whole.
The Bank of Zambia entourage
was further informed that
people from towns like
Chavuma where there were no
commercial banks had to
travel long distances to
Kabompo or Solwezi to collect
their salaries and bank their
money.
Such transactions were not
only dangerous and costly but
also extremely unfortunate.
He urged the Bank of Zambia
to try and encourage
commercial banks to take up
the challenge of opening
Banks. Mr Hazemba also
mentioned that there were
prospects of two banks moving
to Mufumbwe which was good
news for the Province. He was
also happy that one bank had
opened a branch in Shoprite
Solwezi. Mr Mulomba
informed the District
Administrator that it was in
the Bank of Zambia Strategic
plan to have the public's access
to financial services increased
as currently only about 38% of Participants to the Stakeholders Workshop on the BoZ Act review, which took place at the Mulungushi International Conference Centre Lusaka recently
Zambians had access to are caught registering in readiness for the deliberations
financial services. The
Regional Director alluded to
the fact that commercial banks
had a major role to play in this
important strategic focus by
Security official seize K255m in Chipata
ensuring that they reached as
many districts as possible
within the nation. He further
assured the provincial
administration that the Bank
of Zambia would do all it could
to encourage commercial
banks to take up the challenge
of opening more outlets not
o n l y i n N o r t h -We s t e r n
province but throughout the
country. However, he admitted
that this was not easy because
banks, like any other
businesses, wanted to make
profit and would only move
into an area where they felt
they would be able to get a
good return out of their
investment. Mr Mulomba
further pointed out that banks
should look at long-term
business growth and not
concentrate on short-term Mr. Norbert Mumba (r) and other members of the team inspecting Mamarula Lodge in Chipata in readiness for the signing of the tripartite agreement
profits if this strategy was to be
By Zambanker reporter legalized system, which would Reserve Bank Governor's Last year, Zambia and
attained.
The Zambia Revenue Authority allow for the exchange of Executive Assistant, Mr Ralph Mozambique signed a
The Regional Office chief (ZRA), in conjunction with other currency among the three Tseka and Assistant Director – bilateral agreement that
expressed happiness with the security forces in Chipata, countries. In the recent past, Currency at the Bank of Zambia, facilitated the repatriation of
representation of the seven recently thwarted a bid by some ZRA has seized money which Mrs Angela Chileshe. currencies between the two
commercial banks in Solwezi, unscrupulous persons to was being exchanged illegally”, Also in the team were Mr Banji countries.
smuggle K255 million out of the Mr Siame said. He also said Milambo of the Non-Bank “In addition, the Bank is now
country. And a week earlier, traders would be encouraged to Financial Institutions discussing with Malawi on the

BoZ lauds cops ZRA with other security officials

By Zambanker reporter
Bank of Zambia (BoZ) has
commended the Zambia Police
(ZP) Command for continuing
to promote the cordial
relationship which exists
between the two
organizations.
BoZ Acting Assistant Director
– Security, Kedrick Zombe said
the secondment of the police
officers to the Bank was as a
result of the rationalisation of
the security functions to
enhance the functions of
security at the Bank.
Mr. Zombe said this at a
farewell dinner hosted in
honor of a contingent of
eleven ZP Officers who
successfully went through the
recruitment process and
commenced their duties with
the Bank on 28th February
2008.
“Before going any further,
allow me to express our
gratitude to the Police
Command for responding
favorably to the request which
was first made in June 2007.
The Bank relied upon the
existing relationship with the
Zambia Police Service as a fall
back on experienced resource.
Since its establishment, the
Bank has continued to
collaborate and work very
well with the Police service.”
he said.
Mr. Zombe added that assets
of the Bank needed to be
protected in order to ensure
that operations of the Bank
were conducted in a safe and
secure environment.
“In order to achieve the Bank's
mission, which is to formulate
and implement monetary and
supervisory polices that are
aimed at ensuring price and
To Page 5
in Chipata, seized 2.5 million
Malawian Kwacha which had
been brought into the country
illegally.
The revelations were made to a
technical team of central
bankers from Malawi,
Mozambique and Zambia who
were in the Eastern province to
make arrangements for the
signing of a tripartite
agreement as well as bilateral
agreements for the repatriation
of banknotes between the three
countries.
The currencies involved in the
planned tripartite agreement
are the Malawian Kwacha, the
Mozambican Metical and the
Zambian Kwacha.
Mwami border post ZRA Station
Manager, Mr. Victor Siame
welcomed the planned
agreement to legalise the
exchanging of currencies
between Malawi, Mozambique
and Zambia, adding that it had
come at the right time.
“There is need to have a
exchange their money at legal
points because there would be
no need to use a third currency
like the US dollar to change one
of the tripartite currencies into
another. The third currency
exchange causes traders some
losses which could be avoided
by direct exchange of the
regional currencies.
Preparations for the signing
ceremony, to take place in
Chipata, Zambia have reached
an advanced stage with a team
of officials from the three Banks
having undertaken a pre-
signing tour of the possible
venue in Chipata.
The Technical team, led by
Bank of Zambia Assistant
Director–Regulatory Policy and
Liquidation, Mr Norbert Mumba
visited the Eastern Province to
lay ground for the signing
ceremony planned for the
fourth quarter of 2010.
Others in the team were
Mozambican Central Bank
Assistant Director for Currency,
Mrs. Benedita Guimino, Malawi
Supervision Department, Mr
Mwelwa Mwaba of Payment
Systems Division and Mr
Marvin Ilunga of the Public
Relations division.
The team was detailed to check
the border posts in Katete and
Chipata, accommodation, the
venue for the signing ceremony,
restaurants, possible locations
for official visits, the new train
station in Chipata and other
facilities that would be of
interest during the visit.
Mr Mumba's entourage was
also tasked to sensitize relevant
authorities and interest groups
of the planned ceremony for the
signing of the tripartite
agreement.
At Chanida border, 120
kilometers from Chipata, the
team informed ZRA officials
that the Bank of Zambia had
released a circular to all
commercial banks and bureau
de change authorising the
repatriation of banknotes
between Zambia and
Mozambique.
possibilities of reaching a
similar agreement and that
there was to be a signing of a
tripartite agreement among
the three central banks, as
well as bilateral agreements
between Malawi and
Mozambique, and Malawi and
Zambia to facilitate this”, Mr
Mumba said.
And the ZRA Station Manager
informed the team that the
clearing of goods including
motor vehicles, was now
being done electronically at
Chanida border and that
taxpayers were no longer
being asked to clear through
Mwami border after entering
Zambia.
And speaking to team
members after touring all the
possible sites, Mr Mumba said
a lot of progress had been
made and that the final report
would be made available to
the respective Governors and
their key staff before dates
could be set for the signing
ceremony.

A BANK OF ZAMBIA JOURNAL 3 ZAMBANKER SEPTEMBER 2010


Develop payment systems, urges Fundanga
By Zambanker reporter
A well developed and
regulated payment system
Regional Banks visit BOZ
Members of the delegation from the Bank of Uganda, led by former Governor Emeritus Leo Kibirango (l) during a courtesy call on Deputy
Governor - Administration Dr. Tukiya Kankasa-Mabula (not in picture) in the Bank of Zambia boardroom
By Zambanker reporter
The Bank of Zambia has been
a hive of activity with several
central banks in the region
sending delegations on
conducted study tours in
various fields that they
consider important to their
operations. Amongst the
central banks that visited the
Bank of Zambia (BoZ) were
the Bank of Uganda, the Bank
of Tanzania, the Reserve
Bank of Malawi and the Bank
of Lesotho.
Recently, the Bank of Uganda
requested for a one-day
study placement with the
Bank of Zambia. The Bank of
Uganda is in the process of
re-designing jobs and re-
engineering its structure and
processes in a bid to improve
the efficiency and
effectiveness of service
delivery.
The purpose of the study
placement was to possibly
buy into, and share with the
BoZ business process and
Human Resource systems,
institutional challenges and
identify best practices to
support the reorganization
process at the Bank of
Uganda. The team comprised
two Consultants, namely
Governor Emeritus Leo
Kibirango and Mr Robert
Akeny, and an Officer from
within the Bank, Mr Solomon
Oketcho.
Deputy Governor-
Administration, Dr Tukiya
Kankasa-Mabula said during
the Ugandan delegation's
courtesy call on her that the
Bank of Uganda was in
Zambia to understudy the
business process and human
resources systems, share
institutional challenges, as
well as identify best practices
to support the reorganization
process at the Bank of
Uganda.
She explained that in the
main, the goal of
A BANK OF ZAMBIA JOURNAL
plays an important role in
enhancing and promoting
soundness in the financial
restructuring, reorganizing,
fine-tuning, and downsizing of
the BoZ was aimed at
transforming the Bank into a
modern central bank in line
with other modern central
banks. She said for BoZ, this
process had been more or less
continuous from the early
1990's, while elaborating that
before the 1990's, BoZ was
operating like any other
parastatal organization in the
country. Positive steps to
transform the Bank were taken
in the early 1990's which
coincided with a change in the
political dispensation in the
country.
She added that the BOZ was
still unable to deliver the main
objectives for which it was
created, that is, price stability
and monetary policy
implementation. This was
because the design of the
structure was not in
conformity with the design to
enable the BoZ deliver on its
strategic objectives.
She said the BoZ undertook
major rationalization or
reorganization exercises in
1992, 1994 and 2004-2005,
which were aimed at
improving its operational
efficiency and effectiveness.
These rationalization
programmes took the form of
consolidation, realignment,
reassignment of institutional
priorities, standardization,
specialization, mutual support
or improved inter-operability
and greater cooperation within
and between departments.
“Since rationalization is a
change process, in-between
and after these programmes,
the Bank continued to take
consistent improvement
actions to ensure that the gains
made were entrenched. The
1992 and the 1994
rationalization processes were
undertaken to address the
demands of the changed
economic policy in the country.
NEWS
system and is a catalyst for
creating efficient
transmission of monetary
Inevitably, it took the form of
realignment by way of
downsizing, arising from the
shedding off of peripheral
functions, thereby
concentrating on core central
banking. The number of staff
at the time reduced from 1,400
to 600 by the end of 1994. The
gains made from this
rationalization exercise were
acknowledged by the IMF,
where the process was dubbed
the 'Fall and Rise of the Bank of
Zambia,” she explained.
She said in 1994, a further
restructuring exercise was
carried out to align the
organizational structure and
jobs to the Bank's strategic
objectives.
The restructuring entailed
work on the organizational
structure, salar y scales,
pension scheme, and staff
placement, amongst others.
She elaborated that the Bank
made a decision to outsource
some of its support services,
such as retail banking,
cleaning, catering, and estate
agency. This resulted in the
establishment of the General
Services Department, which
was to direct and control the
technical functions of the Bank
pertaining to the property of
the Bank, Project contracts and
contracts related to equipment
and materials procured by the
Bank, as well as fleet
management.
Dr Kankasa-Mabula explained
that to strengthen the main
business of the Bank, the
Financial Markets Department
was created and was aimed at
supplementing and
complementing monetar y
policy implementation. She
said a project was set up to
strengthen the Bank
Supervision function in order
for it to meet international
performance standards.
Members of staff were hired to
increase the number of
inspectors, and the
4 ZAMBANKER SEPTEMBER 2010
value in the economy.
Bank of Zambia Governor, Dr.
Caleb Fundanga said a well
department was reorganized
to have four divisions, which
were at the time Regulatory
Policy, Banks, Non Banks, and
Foreign Exchange Agents. This
invariably resulted in the
expansion and enhancement of
Inspection procedures.
On the legal side, Dr Mabula
said the Banking Act was re-
enacted to the present Banking
and Financial Services Act.
Earlier, the Reserve Bank of
Malawi and the Central Bank of
Lesotho sent delegations to
understudy the Bank of
Zambia's Risk Management
system, as well as its Business
Continuity Management
Frameworks.
The Bank, through the Risk
Management department also
hosted three officials from the
Bank of Tanzania, who visited
the Bank from 19 - 23 October
2009. The officials from the
BOT visited the central bank
with the aim of familiarizing
themselves with the Bank of
Zambia Risk Management
Framework.
The Bank of Tanzania recently
established a Directorate of
Risk Management and, with
this in view, sent officials to
familiarize themselves with an
already existing infrastructure
by visiting the Risk
Management Department at
BoZ. During their study tour,
the officials were oriented on
the following important
components of the Bank of
Zambia Risk Management
Framework: the Operational
Risk Management; the
Business Continuity
Management; the Lender of
Last Resort; Financial Risk
M a n a g e m e n t Fr a m e w o r k
focusing on Middle Office
operations, Open Markets
Operations, Foreign Exchange
Intervention and Management
of International Reserves; the
Project Management Office;
and ICT Governance and
COBIT.
functioning and developed
payment system is an
essential requirement for the
development of a market
economy, as well as deep
financial markets.
Dr Fundanga said this when
he officiated at a workshop
organised by the Financial
Sector Management
Programme of the
Macroeconomic and Financial
Management Institution of
Eastern and Southern African
(MEFMI), held on 12 July,
2010 at Intercontinental
hotel.
“Equally important is its role
in the enhancement of the
conduct and transmission of
monetary policy.
C o n v e r s e l y, i n e f f i c i e n t
payment system operations
can be a channel for causing
distortions in the economy
through inordinate delays in
the monetary policy
implementation and in the
settlement of financial
transactions, which will
invariably prevent the central
bank from achieving its
objectives of price stability
and a sound financial sector,”
Dr Fundanga said.
He, however, observed that
the MEFMI region still faces a
lot of challenges with respect
to the development and
oversight of payment system,
notable among these being
the regulation of non-bank
payment system providers,
such as the mobile phone
companies.
He further went on to state
Moonga reaches for the sky in CIPS
By Zambanker reporter
Bank of Zambia (BoZ)
Assistant Director of
Procurement, Kizzy Moonga
has been conferred with the
t i t l e o f Fe l l o w o f t h e
Chartered Institute of
Purchasing and Supply (CIPS)
(awarded by the United
Kingdom-based institution.)
Fellowship (FCIPS) is the
highest grade of membership
available at the Institute and
is awarded as a hallmark of
professional standing. It is
awarded in recognition of
achievements within the
profession and is a definition
of professional status, not
merely a reward for service.
Mr. Moonga becomes the
fourth Zambian to receive
this lucrative award.
Mr. Moonga is one of the
oldest procurement
practitioners in Zambia, with
a vast experience in the
procurement field spanning
an unbroken record of 21
years.
Prior to joining the Bank of
Zambia family, Mr. Moonga
worked for Zambia
Consolidated Copper Mines
(ZCCM) as Assistant
Superintendent and handled
ver y diverse and huge
procurement projects in the
then state-owned mining
giant.
In terms of academic
achievement and knowledge
enhancement, Mr. Moonga
informed the Zambanker that
he had also taught CIPS and
CIM (Chartered Institute of
Marketing) courses in line
with his career path at the
Copperbelt University in
that the regulation of
innovative payment system
products, aimed at ensuring
that the law contributes to
p a y m e n t s y s t e m
developments and
operations, also poses a
challenge to the MEFMI
region.
Dr Fundanga said MEFMI
should also overcome
challenges such as ensuring
that full utilisation of large
value payment systems by all
stakeholders including the
government are made, and
ensuring that there is
effective cooperation
between different regulatory
authorities in the regulation
of payment systems.
He expressed happiness at
the fact that the workshop
would address the key issues
and challenges faced by
MEFMI through discussions
and lessons of experience.
“I am confident that the rich
discussions you are going to
hold and the lessons of
experience you are going to
share will not only enhance
your skills, but also bring out
pertinent issues that require
to be addressed when you go
back to your home countries,”
Dr Fundanga said.
Dr Fundanga thanked the
North-West University in
South Africa, the South
African Reserve Bank, and the
Reserve Bank of Zimbabwe
for releasing their officials to
share their knowledge and
experience at the workshop.
Mr Moonga
Kitwe, being a holder of a
post-graduate diploma of the
Chartered Institute of
Marketing. This is all apart
from being a CIPS
qualification holder.
He is a full member of the two
international professional
bodies, as well as the Zambia
Institute of Purchasing and
Supply. He also has a
Bachelors Degree in Business
Administration (BBA) and
recently acquired a Masters
Degree in Business
Administration (MBA).
The Zambanker congratulates
Mr. Moonga on his recent
achievements.

FINSCOPE 2009 Survey Completed
Hon. Situmbeko Musokotwane confers with Governor Caleb Fundanga during the official launch of the Finscope
Zambia 2009 - Topline Findings Report at Hotel Intercontinental in Lusaka. Also present at the launch were
Mrs. Maya Makanjee (l), Head of Finmark Trust, Dr. Denny Kalyalya, Deputy Governor - Operations (2nd from l)and
Mr. Likolo Ndalamei, Secretary to the Treasury (3rd from r)
By Cynthia Chiyabu
Minister of Finance and
N a t i o n a l P l a n n i n g , D r.
Situmbeko Musokotwane has
said that access to a well-
functioning financial system
has the potential to
economically and socially
empower the poor and low
income people, as well as
micro-enterprises.
Dr Musokotwane said despite
the broad consensus on the
importance of financial
inclusion as, among others, a
poverty alleviation tool, it is
estimated that between 2 and
3 billion people around the
world are still excluded from
access to financial services.
He said the situation is
particularly dire in developing
countries where often the
majority of the population is
excluded from the formal
financial system.
Dr Musokotwane said this
during the Financial Sector
Development Plan (FSDP)
national launch of the findings
of the Zambia FinScope 2009
survey, which was held at
Hotel Intercontinental in
Lusaka on 27 July, 2010.
He said the first phase of the
From Page 3
financial system stability, the
Bank has various assets, both
material and in the form of
human resource.” he said.
Mr. Zombe said the BoZ was
responsible for distributing
currency throughout
Zambia, and as such, the
institution is a key and
strategic institution in the
economy. “The physical
'Help us promote public welfare'
Mr Hamududu
A BANK OF ZAMBIA JOURNAL
FSDP, which was being
implemented as a programme
intended to address observed
weaknesses in the financial
sector, ran for five years from
2004 to 2009.
“In view of various
outstanding issues and new
developments arising from the
recent global financial crisis,
the Government approved a
three-year extension under a
second phase of the FSDP to
run until December 2012,” Dr
Musokotwane said.
He said the FSDP represents a
strategy that was formulated
to address the cur rent
weaknesses in the Zambian
financial system in its entirety,
which is aimed at realizing the
vision of a financial system
that is sound, stable, and
market-based and would
support efficient resource
mobilization necessary for
economic diversification and
sustainable growth.
He further said the financial
sector has witnessed
significant growth in the
industry during the period of
implementing the FSDP, with
new banks opening up to take
advantage of a favourable
BoZ lauds cops
distribution of currency is
very critical to the support of
industries and commerce.
This activity has to be done in
a safe and secure manner to
avoid delays and disruptions
in the economy.” he added.
From Page 1
the foundation for high,
sustainable real growth and
that this was a goal that the
BOZ was expected to achieve.
And speaking earlier, Bank
Governor Dr Caleb Fundanga
thanked Members of
Parliament for accepting the
invitation to attend the
seminar. He urged them to
contribute freely to the
deliberations and to form a
platform for future
consultation and networking.
And giving a vote of thanks on
behalf of the MPs, Chairperson
of the Committee on
Estimates, Honourable
NEWS
economic environment.
Dr Musokotwane said five new
commercial Banks had so far
been granted licenses to
operate during the initial
phase of the FSDP period.
“In the non-bank financial
institutions sector supervised
by Bank of Zambia, the
number of market players
increased by over 100 per cent
over the last five years with
further applications still being
considered.
This has largely been as a
result of new entrants in the
microfinance and bureau de
change sub sectors, which has
also seen the first Credit
Reference Bureau licensed,”
he said.
Dr Musokotwane, however,
said growth in the financial
sector goes beyond just the
number of licensed
institutions. This is noted in
other indicators such as the
asset base, outreach through
branch and agency network,
as well as innovation of
products.
He said one of the priority
areas identified under the
FSDP relates to the production
of market knowledge on the
He also said that security
within the Bank's premises
was of paramount importance
in order to ensure that no
harm is occasioned on Bank
employees and its valued
clientele.
Highvie Hamududu thanked
the Bank of Zambia for
conducting the workshop for
the Members of Parliament.
He said there was need for the
Bank, together with all
Members of Parliament to
continue interacting in order
that legislators are informed
on the various developments
on monetary policy. “This
workshop will allow Members
of Parliament to debate from a
knowledge stand-point.
It is also important for the
Bank to give us comparative
information on the
performance of the financial
sector in the SADC region,” he
5 ZAMBANKER SEPTEMBER 2010
demand and supply for
financial services in Zambia.
Since its inception, the
renowned FinScop project has
been providing annual
insights into how consumers
source their income and
manage their financial lives.
In Zambia, the FinScop project
is sponsored as a national
agenda under the FSDP
programme, with funding
support initially provided by
cooperating partners and
more recently by the private
sector development reform
programme.
Dr Musokotwane said it was
however noted that there was
improvement in extending
financial services and
products, such as savings and
credit, through other formal
and informal non-bank
financial institutions. On the
overall, there was a marginal
increase in financial access to
37.3% in 2009 from 33.7% in
2005.
He said government would
remain committed to increase
this further, and in the
medium term has at least half
of the adult population in
Zambia having access to
financial services and
products.
And speaking earlier, Bank of
Zambia Governor, Dr Caleb
Fundanga said the role played
by the financial sector in
Zambia's economic
development had been limited
over the recent years with the
sector being characterized by
low financial intermediation
and high concentration of
bank branches in urban areas.
He said the government
formulated the FSDP as a
programme to address various
sectoral weaknesses and
ultimately broaden and
deepen Zambia's financial
sector.
“In this regard , Finmark Trust
of South Africa was contracted
to undertake this activity,
under what is widely referred
to as the FinScope Consumer
Survey, initially in 2005 and
subsequently, in 2009 for a
follow up study. The main
objective of the FinScope
In June 2007, BoZ requested
the office of the Inspector-
General of Police to shortlist
thirty Officers, who were later
subjected to intensive
screening before finally being
seconded to the Bank.
Only Eleven Officers have so
far successfully gone through
the recruitment process and
have commenced to discharge
their duties at the Bank.
said.
He also noted that there
were various successes that
the country had achieved in
the financial sector in the
recent past. He said it was
important for the country to
begin to take note and
celebrate such successes.
The MPs that attended the
seminar were from the
Public Accounts Committee,
Committee on Estimates,
Committee on Economic
A f f a i r s a n d L a b o u r,
Committee on Legal Affairs
and the area Member for
Siavonga, Honourable
Douglas Siakalima.
Surveys is to provide
information that is central to
the sound function of financial
markets and relevant to both
service providers and policy
makers,” Dr Fundanga said.
He said similar surveys had
also been undertaken in South
Africa, Namibia, Botswana,
Kenya, Uganda, Tanzania, and
Mozambique.
He further said the findings of
the FinScope Survey are,
among other things, expected
to play an important role in
profiling demand and needs of
financial services in Zambia.
He added that the findings are
expected to highlight new
market segments and
opportunities which, in the
long run, should trigger
innovation in product design
by service providers and
st
Mirriam is 1 runner-up
By Zambanker reporter
Bank of Zambia's Mirriam M.
Mutati from the Regional
Office in Ndola recently
scooped the 1st Runners-up
position in this year's Personal
Assistants Africa award
ceremony held on September
24, 2010 at Sunbird Hotel in
Lilongwe, Malawi.
The awards are held in
recognition of the important
role played by Personal
Assistants in corporate
productivity.
This is the fourth time the
awards are being held since its
launch in 2007, with the
ceremony being held in
Nairobi, Kenya at that time.
In 2008, the event was hosted
in Kampala, Uganda, while
Tanzania hosted the event in
2009 in the country's
c a p i t a l o f D a r- e s -
Salaam.
The event, organized
by a management
development
organization, the
International
Renaissance Centre of
Kenya brings delegates
together from various
countries within the
region.
The awards seek to
recognize
Personal
Assistants
delivery to their intended
customers. Dr Fundanga said
the findings would assist in
identifying which legal, policy,
regulatory or market issues are
considered as obstacles to
growth, innovation and
competition.
He further said the expansion
and improvement of financial
access in the country was likely
to contribute to employment
generation, economic growth,
human development and
ultimately poverty reduction.
Dr Fundanga added that it was
imperative to fully understand
the landscape of financial
service provision in Zambia in
order to be able to open up new
market segments which for a
very long time had lacked
access to financial services.
who, among other issues,
provide extraordinar y
support and continually
think of ways to streamline
processes, while improving
performance and output.
Mr. Evarist Ahimbisibwe,
from the Ministry of Works
and Transport in Uganda
received the overall award of
the 2010 Personal Assistant
of the Year award and walked
away with US$1500 and
accommodation gift
vouchers from Sunbird
Malawi Hotel for two.
Zambia's Mirriam Mutati
won herself a laptop
provided by JTM Technology
Kenya, as well as dinner gift
vouchers from Sunbird
Malawi Hotel for two.
Zambanker joins
all well-
wishers in
congratulati
ng Mrs.
Mutati for
yet again
putting the
country and
the Central
Bank on the
global map.

SADC ICT gurus look ahead
By Zambanker reporter
Chairperson of the SADC ICT
Forum, Mr Paulo Maculuve
has observed that demand for
infor mation security is
increasing the world over,
especially with the growth of
ICT-based products.
He adds that accordingly,
there is need to work out
measures to address any
issues that may threaten its
positive growth in the region.
Speaking during the SADC
ICT Forum hosted by the
Bank of Zambia in
Livingstone recently, Mr
Maculuve said that the Forum
had since tasked its Business
Participants to the SADC Information and Communication Technology Forum pose for a group photograph in Livingstone recently
BoZ donates to Kalabo High School
From Page 2
school.
The chairperson thanked
the Bank of Zambia for not
only donating the mattress,
but for also providing
transport for the donated
items up to Mongu in
Western Province.
“At this stage I want to
Mr Mayondi handing over the matresses to Mr Nalishebo Mundia, as Mr Seth Muleya (c) looks on
A BANK OF ZAMBIA JOURNAL
Continuity Management
(BCM) team to prepare high
level terms of reference for a
working group to address
information security.
He said that the Forum had,
through the Reserve Bank of
South Africa, also offered to
host an information security
workshop to deliberate on
how to address issues that
would negatively affect the
operations of the regional
central banks.
He explained that the Bank of
Zambia, would at this
workshop, provide
information on cyber security
and that the Forum's BCM
thank the Bank of Zambia.
Apart from their own
donation, they agreed to
transport other mattresses
that were bought by
FokaSHA. That is a great
sacrifice”.
Mr. Muleya thanked the Bank
of Zambia and FokaSHA for
the donation. The Permanent
NEWS
team had been tasked to
prepare high level terms of
reference for a working group
to address infor mation
security, subject to the
approval by the ICT Forum.
He added that the Forum was
in the process of developing a
concept paper on regional ICT
skills developed so far and
that the concept paper was
expected to be completed by
the beginning of the fourth
quarter.
Mr Maculuve explained that
the skills development
concept paper would include
concepts like how to create
ICT capacity building for
Secretary urged all well
wishers to come on board and
help in improving not only
Kalabo High School, but all
schools in Western Province.
“I want to thank you most
sincerely, FokaSHA and Bank
of Zambia for coming to
We s t e r n P r o v i n c e a n d
bringing this donation. We are
6 ZAMBANKER SEPTEMBER 2010
medium and long term ICT
requirements.
The paper is also expected to
consider ICT learning
programmes involving other
stakeholders such as banking
and educational institutions,
how to continuously up-skill
staff and how to share the
existing ICT skills with SADC
central banks.
He said that so far, a skills
database development had
been finalized as part of the
SADC Committee of Central
Bank Governor's (CCBG)
website upgrade.
He added that a skills survey
was in progress and would be
glad that former pupils have
remembered the need to
improve the welfare of pupils
at Kalabo High School” he
said. FokaSHA donated 48
mattresses and one football
while BoZ donated 36
mattresses and provided
transport for the entire
consignment.
finalized after which the
database would be
popularized.
The Chairperson said that the
SADC website upgrade was
being coordinated by the
Reserve Bank of South Africa,
which had delivered the
detailed requirements,
design and development
plan. He added that the
development begun in June
2010 and would be completed
by 15 October this year.
The team consisted of
developers from the Banco de
Mozambique, Bank of Zambia
and the Reserve Bank of
South Africa.
And giving an update on the
projects that had either been
completed or were under way,
Mr Maculuve said the Central
Bank of Lesotho, the Bank of
Tanzania and the Reserve
Bank of Malawi had visited
the Bank of Zambia to study
its risk and business
Performance of NBFIs analysed
By Zambanker reporter
Bank of Zambia (BoZ)
Governor Dr Caleb Fundanga
has described as fair, the
overall performance and
condition of the Non-Banks
Financial Institutions (NBFIs)
in the second quarter of
2010.
Dr. Fundanga said this
during the Gover nor's
quarterly meeting with Chief
Executive Officers of Non-
Bank Financial Institutions
th
held on 4 August 2010 at
the Bank of Zambia.
“The overall financial
performance and condition
of the non-bank financial
institutions was rated fair
during the quarter under
review. The sector was
adequately capitalized with
fair asset quality, while
earnings and liquidity were
marginal” he said.
The Governor said the
leasing subsector reported
some regulatory capital
deficiencies owing to four
leasing companies not
having adequate capital.
The Governor also said the
decrease in the sub-sector's
aggregate regulatory capital
was largely due to a loss after
tax of K6,749 million
reported in the sub-sector in
the quarter under review.
“The overall liquidity
position of the leasing and
financial sub-sector as
measured by the ratio of
liquid asset to total deposits
and short-term liabilities
was 9% (March 2010: 15%).
The liquidity was below the
prudential minimum of
15%” he said.
The Central Bank Governor
also described the financial
condition and performance
of the micro finance sub-
sector as fair.
“The sub-sector had
satisfactor y regulation
capital position and asset
quality and earning
performance. The regulatory
capital of the MFI sub-sector
was K217,805 million
(March 2010: K208,375
million) and was above the
aggregate minimum
regulatory capital position of
K67,141 million by
K150,664 million” he said.
Dr. Fundanga attributed the
increase in regulatory capital
continuity management
frameworks.
He said it was important that
the coordinating team of the
BCM collect information on
the status of BCM projects in
each central bank and that
these needed to be presented
at the next meeting.
Meanwhile, the chairperson
has said the SADC central
bank's ICT architecture being
coordinated by the Banco de
Mozambique had developed a
concept paper regarding the
ICT Architecture and the
concept includes scores of
projectives, payment
applications, exchange
control applications,
settlement applications,
financial and money market,
c o l l a b o r a t i o n
communications research and
statistics.
The project deliverables are
information data architecture
and network architecture.
to an increase in the sub-
sector's primary earnings of
K5,583 million, coupled with
a profit after tax of K2,171
million recorded during the
period under review.
And speaking on bureau de
change sub-sector, the
Governor said the financial
condition and performance of
the bureau de change sub-
sector was rated satisfactory.
“The volume of purchases
and sales of foreign currency
by the bureau de change sub-
sector in the quarter under
review amounted to
US$123.5 million
(equivalent to K608,643
million) and US$123.7
million (equivalent to
K612,559 million)
respectively, compared to the
previous quarter's volume of
US$106.8 million
(equivalent to K491,805
million) and US$107.1
million (equivalent to
K493,805 million)
respectively” he said.
The volume of foreign
exchange transactions
represented an increase of
15.6% over the previous
quarter.
And Governor Fundanga
revealed that the United
States dollar remained the
most traded currency in the
p e r i o d u n d e r r e v i e w,
accounting for 95.9 percent
followed by the South African
Rand at 2.7 percent.
Dr. Fundanga
 NEWS

No effective leadership, no true development

By Zambanker report
Deputy Governor –
Operations, Dr Denny
Kalyalya has said that there
can be no true development in
the Bank without good and
effective leadership.
Speaking at the High
Per for mance Leadership
workshop for senior
management staff at Lilayi
Lodge recently, Dr Kalyalya
said leadership was required
in order for the Bank to
achieve its objectives.
'We live in a dynamic world
which calls for good
leadership dedicated to hard
work, daily learning, fast
thinking and acting swiftly
and prudently at all times,' he
added.
Dr Kalyalya further reminded
participants that not too long
ago, they were involved in the
review of the Bank's strategic
plan that brought into
existence the 2009-2012
strategic plan.
In order to fully implement
the goals and objectives of the
strategic plan, there was need
to enhance leadership skills.
The Deputy Governor said it
was against this background
that this workshop was
organised. The Bank's desire
was to constantly upgrade
leadership skills for the
attainment of goals and
objectives even in the face of
daunting challenges.
He further underscored the
importance senior
management attached to
capacity building
programmes for all Bank
employees.
The workshop, which was growth for the past 10 years inflation has since returned to remained a key challenge in realise how to apply.
organised by Human and over the last five years, single digit levels. the face of limited resources, The participants further said
Resources department in real GDP growth rate had Further, the financial sector infrastructure and financial that the topics covered by
conjunction with MCA a v e r a g e d 6 % a n n u a l l y. recorded tremendous growth inclusion. MCA International and its
international of South Africa, Inflation and exchange rate since the commencement of And participants spoken to by facilitator, Mr. Dave Boreham,
covered topics such as self developments have also been liberal economic and financial the Zambanker expressed were relevant to their being
awareness, time favourable. In 2006, a single policies in the early 1990s and happiness that they were able able to achieve the objective of
management, action or goals digit inflation level was equally positive to attend the workshop as the Bank.
required to achieve a mission, attained. developments have been they were given an Topics such as emotional
emotional intelligence and Although inflation rose to registered in the payment opportunity to refresh their intelligence and values and
values, power to take action double digit levels at the end systems. individual and collective power to take action proved to
and ability to manage of 2008 owing to the effects of Dr Kalyalya said sustaining memories on what they be some of the more popular
direction successfully. the global economic crisis, macroeconomic stability already knew, but did not ones during the workshop.
Dr Kalyalya alluded to the fact
that some of the topics that
were lined up may not have
been entirely new to
participants, but he firmly
believed that they could be
necessary for purposes of
reinforcing what was already
known. Courses such as high
performance leadership are
intended to facilitate the
exchange of information and
views on appropriate
leadership attributes in order
to help in enhancing
performance for leaders in
various positions.
The Deputy Governor
reminded participants that
the role of the Bank was to
deliver low and stable prices
and maintain financial system
stability.
In spite of the global economic
downturn, Zambia was
enjoying relative economic
stability with good prospects
for the future following the
recent and on-going
significant transformation of
the economy.
Due to implementation of
appropriate macroeconomic
policies, the country had
registered positive real GDP

BoZ employees urged to write wills
By Zambanker reporter
Bank of Zambia employees
have been encouraged to
write wills so that adequate
provision for their loved ones
is taken.
Speaking at a will writing
session in the Bank of Zambia
Auditorium and organized by
Human Resources
department for employees in
Lusaka recently, Mr Charles
Chanda of Chanda Chizu &
Associates said reasons why it
was advantageous for an
individual to write a will
include choosing a person one
wants to run their affairs or
estate when they are gone, to
prevent property grabbing
and to ensure that life savings
go to the designated people.
Laws on inheritance and
succession in Zambia are
governed by two pieces of
legislation, and these are
Intestate Succession Act and
the Wills Act.
A will is a legal paper that
describes who should receive
one's probate property after
they are dead and is typically
prepared by a lawyer and
signed by the testator in front
of at least two appropriate
witnesses and a public notary.
A will can also be described as
a legal declaration of intention
to confer a benefit on another,
which will take effect upon the
death of the writer.
Mr Chanda explained that
wills are generally governed
by the law and therefore the
Wills Act provides formalities
to be followed when preparing
a will. The law requires that
formalities should be followed
or else the will could be
disregarded by the courts of
law and one's wishes would
not be followed.
Some of the formalities
required include the fact that
the will has to be in writing,
signed by the testator or by
some other person and signed
or acknowledged in the
presence of two witnesses.
Any person except a minor, is
allowed to make a will, and
any one can be a witness to a
will except an insane person,
minors and illiterate persons
and beneficiaries unless in
the presence of two
independent witnesses.
A person making a will can
choose as administrator,
anyone they wish to
administer their will once
they have passed on. Mr
Chanda also clarified on the
provisions for cancellation or
revocation of a will.
“It is possible for one who has
made a will to cancel it. This
can be done by a document
known as codicil, which is
another will.
A will can also be cancelled or
revoked through a written
declaration of intention to
revoke or through tearing or
burning”.
Section 20 of the Wills Act
gives the High Court power to
vary a will where there are
unreasonable provisions for
the spouse, children or
dependants.
In order to write a will and in
order for it to take effect, the
testator must identify
themselves, identify the
assets, name the
beneficiaries, name personal
representatives and their
authority and revoke all other
wills, that may exist.
Copperbelt Universty Management and Accountancy Association (CUMAA) members who visited the Bank of Zambia recently captured in front of the
Consistent Performance vital - Kankasa-Mabula
By Zambanker reporter
Deputy Governor –
Administration, Dr Tukiya
Kankasa-Mabula has advised
that no organisation can
consistently perform at a high
level unless the capabilities of
middle management and top
management are aligned.
Speaking at the official
opening of a management
development programme
organised for middle
management employees at
Chrismar Hotel in Lusaka
recently, Dr Kankasa-Mabula
said for the Bank, aligning of
capabilities meant that both
levels of management must
steadfastly uphold the vision
which was 'to be a modern,
dynamic, credible and effective
central bank' and be able to
identify specific roles in
realising this vision.
'It has been observed that a
number of organisations tend
to have weak middle
management teams and strong
top management or vice versa.
W h i c h e v e r w a y, n o
organisation can consistently
perform at a high level unless
the capabilities of middle
management and top
management are aligned,' she
said.
The Deputy Governor further
stated that the Bank attached
special importance to staff
training and development as a
way of benchmarking its
operations, learning best
practice and enhancing
BoZ building with Bank staff members
competence levels of its
employees.
T h e m a n a g e m e n t
development programme was
designed to strengthen
managerial and supervisory
capabilities among its middle
management employees. The
Bank recognised that this
category of employees was
very important and critical in
the implementation of Bank
programmes and objectives.
'The programme deliberately
included topics on the core
functions of the Bank so that
you are all aware of what the
Bank does and how the
different departments
complement each other. These
topics are essential because
they allow you to have a
deeper understanding of the
Bank and to understand the
role that each one of you plays
in meeting the Bank of Zambia
objectives which are enshrined
in the BoZ vision and mission,'
she said.
Dr Kankasa-Mabula further
stated that the Bank preferred
in-house courses because they
allowed facilitators to make
programmes which were
tailored to the needs of the
institution. The management
development programme was
tailored to meet the Bank's
requirements with regard to
developing managers with the
knowledge, skills, attitudes
and behavioural attributes to
meet the Bank's current and
future needs. The programme
took on board topics that were individual performance goals
crucial for management skills and measures such as
such as change management, exploring the concept of
performance management, accountability and
team building and human responsibility, indicating how
resource management among appraisals could be applied as
others. an effective tool for managing
The Deputy Governor also said individual performances and
that while most organisations discussing a systematic
viewed training as an expense, approach to personal
the Bank considered training development planning.
as an investment with tangible The Bank, in this regard,
returns. Despite its dwindling pledges to continue with the
financial resources, the Bank staff development
continued to invest in training programmes as a means to
as a way of ensuring that its improve individual and team
employees kept pace with performance management as
global changes and trends. it implements its objectives.
One of the facilitators, Mr
Adamson Sinyangwe who
made a presentation on
performance management,
said the performance
management process attempts
to systemise good practice to
ensure that what all managers
aimed for and achieved was
what the organisation
required. He added that
performance management
should incorporate
performance improvement
throughout the organisation,
as well as the continuous
development of individuals
and teams.
The aim of this topic was to
help managers reflect on the
process that must underpin
performance management by
outlining a systematic model
of performance management,
highlighting some of the
potential pitfalls of setting Dr Kankasa-Mabula

A BANK OF ZAMBIA JOURNAL 7 ZAMBANKER SEPTEMBER 2010


Is there a Case for Consumer Protection in a
By Nambula Wamulungwe
Liberalised Financial Sector?
There are growing calls for increased
consumer protection in credit
markets, globally. Proponents of
financial inclusion now observe that in
the absence of consumer protection,
the gains of financial inclusion could
be lost. Retail consumers have less
information about their financial
transactions than do the financial
institutions providing the services,
which can result in excessively high
interest rates paid, lack of
understanding about financial
options, and insufficient avenues for
redress. Consumer protection is
therefore, viewed as a regulatory
response to a market failure. This
paper reviews the arguments for as
well as the pit falls in consumer
protection and evaluates the
relevance of the debate for Zambia
with a greater focus on the
microfinance sector. Finally the paper
proposes a relevant framework the
Bank of Zambia could adopt to
enhance consumer protection.
Financial inclusion is a topical theme
in development literature today,
particularly as it relates to its
perceived ability to leverage
multitudes in developing countries
out of poverty. Several developing
countries have made progress in the
development of their financial sectors
over the past two decades. Most of
this success could be attributed to the
liberalisation of financial sectors of
these countries and the
implementation of broader financial
sector reforms.
Most analysts therefore observe that
the financial sectors in most African
countries have begun to deepen their
lending and increase access with new
products and technologies (Honohan
and Beck, 2007). It is further observed
that the microfinance sector is fast
developing on the continent.
As part of broader structural reforms
to the Zambian economy over the last
two decades, the Zambian
government has continued to
implement financial sector reforms
since the early nineties as part of the
broader drive for economic
liberalisation. This included among
others, the removal of interest rate and
credit controls, restructuring and
privatising commercial banks
(Gelbard and Leite, 1999). As part of
the continuing financial sector
reforms, the Zambian government
embarked on an ambitious four-year
Financial Sector Development Plan
(FSDP) in 2004. One of the major
thrusts of this programme was to
increase financial access to the
unbanked majority. A 2006 Finscope
study indicated that 77% of Zambians
did not have access to financial
services (Finscope Zambia, 2005).
As a result of the comprehensive
reforms over the last decade, the
financial sector in Zambia has
experienced substantial growth over
the past few years with the
microfinance sub-sector being one of
the fastest growing. Between
December 2007 and December 2009,
the number of microfinance
institutions (MFIs) increased from 8
to 25 (Bank of Zambia, 2009), a
growth of over 200% in only two years.
Given that the financial sector in
Zambia is still relatively under-
developed, the growth in access to
credit arising from increased
competition in lending has brought
with it increased awareness about
consumer welfare issues in the
financial sector. Complaints abound
over exorbitant interest rates, high
charges and fees, lack of
transparency, etc. (Finscope, 2005)
in both the more formal banking
sector and the microfinance sector.
Proponents for financial inclusion
now observe that in the absence of
consumer protection, the gains of
financial inclusion could be lost. An
Alliance for Financial Inclusion
(2010) report summarises this
A BANK OF ZAMBIA JOURNAL
A Case Study Of The Zambian Micro-Finance Industry
dilemma as follows: 'unchecked
market forces and policies that relax
regulation in an effort to open
financial markets to serve the bottom
of the pyramid can result in
consumers that are harmed as a result
of financial access. Harm can range
from over indebtedness due to
excessively high prices and predatory
lending, to loss of savings or pledged
assets when unscrupulous actors
enter the market for short-term
gain'(Alliance For Financial Inclusion,
2010).
The demands for increased consumer
protection in the financial sector are
not unique to Zambia and other
developing countries. Porteous
(2009) observes that calls for
consumer protection in credit markets
are global and growing (Porteous,
2009: Consumer Protection in Credit
Markets). The motivation for these
concerns largely stems from the
apparent imbalance of power between
consumers and credit providers,
coupled with the generally low levels
of consumer education (Making
credit Markets Work, 2005: Porteous,
2009). The liberalisation of financial
markets globally has resulted in
increased competition to lend, the
relaxation of interest rate ceilings and
consequently, fears of over-
indebtedness in the wake of the
phenomenal growth in retail credit
(Porteous 2009).
Invariably, the category of financial
sector consumers with the greatest
need for protection are the low
income clients who largely depend on
borrowing from micro-finance
institutions which typically have a
higher cost and usually subject to
much lighter regulation.
In response to these growing calls for
c o n s u m e r p ro t e c t i o n , s o m e
developing countries such as South
Africa, Mexico and India have
tightened their regulatory frameworks
by either introducing new legislation
to protect borrowers or tightening
existing lending laws (Porteous,
2009).
Despite the growing consensus
among policy makers and regulators
on the need to increase consumer
protection in credit markets, this is not
necessarily without cost. Intervention
in credit markets is perceived to have
negative consequences of slowing
the expansion of access to credit
(Porteous, 2009). There is therefore a
trade-off to be made between the
benefits and costs of further
intervention in credit markets.
(To be continued in the next edition)
This study seeks to evaluate the
arguments for increased consumer
FEATURE
welfare in the context of the financial
sector in Zambia, particularly the
micro-finance sub-sector, as well as
to propose an appropriate framework.
Motivations And Approaches For
Consumer Protection
Regulation and Consumer
Protection
Regulation is generally viewed as a
proxy for competition. Industries that
are subject to regulation are typically
those that do not easily lend
themselves to competition. As a
result, they lack the discipline of the
market that would normally facilitate
the enhancement of consumer welfare
in its various forms.
Invariably, therefore, calls for
consumer welfare are synonymous
with some form of market failure.
Eisner, et al, 2006 describe consumer
protection as a regulatory response to
a market failure (Alliance for Financial
Inclusion 2010)
It is common to see strong consumer
movements in utility services, for
instance. This is largely so in view of
the market structure of these
industries which typically leans
towards monopoly or oligopoly.
It is therefore, generally perceived that
firms in these industries would have
market power and therefore lack the
incentive to act in the interest of the
consumer. It could be argued that the
financial industry does not share the
same characteristics as a utility
company in the energy, telecoms or
water sectors whose regulation entails
clear regulations for consumer
protection. However, this argument
may be a case of degree, as financial
industries though admittedly with
more players than the latter, are far
from being considered perfectly
competitive.
Consumer protection is therefore
meant to level the playing field
between suppliers and consumers of
financial services (Alliance for
Financial Inclusion 2010).
Motivations for Consumer
Protection in Credit Markets
As with all other regulated industries,
the major call for consumer protection
stems from concerns of inequality
between the consumer and the
provider of a good or service that
compromises the former's bargaining
power. Porteous (2009) in 'Consumer
Protection in Credit Markets'
summarises this view in an extract
from a policy document by the South
African Government: '…There is
considerable imbalance of power
between consumers and credit
providers, consumer education levels
10
are frequently low, consumers are
mostly badly informed about their
rights and unable to enforce such
rights through either negotiation or
legal action…'
The economic basis for the uneven
playing field between lenders and
borrowers partly stems from the
problem of information asymmetry.
The Alliance for Financial Inclusion
summarises the issue as follows:
'Retail consumers have less
information about their financial
transactions than do the financial
institutions providing the services,
which can result in excessively high
interest rates paid, lack of
understanding about financial
options, and insufficient avenues for
redress...Although many financial
institutions adopt practices to ensure
they are well served, some have used
their information advantage(often
abated by regulatory loopholes
intended to promote financial
inclusion) to increase profits at the
expense of consumers who may find
themselves over-indebted, under
insured or without a return on their
investment (Alliance for Financial
Inclusion (2010): Consumer
Protection, Leveling the playing field
in financial inclusion).
Widespread over-indebtedness has
been linked to inadequate consumer
protection. Porteous (2009) observes
that with the liberalisation of financial
markets in many developing
countries, there has been an explosive
growth in retail credit particularly
among first-time borrowers who are
typically the low income borrowers
(Porteous 2009) resulting in
widespread over-indebtedness.
These low income borrowers are
typically customers of micro-credit
institutions.
Over indebtedness is not only a
problem at the individual house-hold
level. On a larger scale, it could
become a systemic risk in the
financial sector as has been
experienced by some developing
countries. Porteous (2009) observes
that Bolivia in 2009 and South Africa
in 2002 witnessed credit 'busts' with
systemic consequences. The US sub-
prime crisis is a classic example of
t h e s y s t e m i c r i s k o f o v e r-
indebtedness in developed countries.
In addition to high prices, over-
indebtedness, loss of savings and
collateral, etc., other authors site
over-zealous collections resulting in
physical or emotional abuse of
customers (Alliance for Financial
Inclusion (2010)) as another
consequence of inadequate
consumer protection.
Mr Wamulungwe
Despite concerns over high interest
rates in some cases, many analysts
warn against the temptation to re-
establish interest rate ceilings.
Porteous (2009) observes that
interest rate ceilings have been
resisted on grounds that 'they impede
the flexibility of new types of lenders
to offer appropriate size loans at
sustainable rates'. He further observes
that the lack of access to appropriate
credit is largely considered a greater
challenge than the 'exploitation' which
would affect a smaller group of
people.
Approaches to Consumer Protection
in the Financial Sector
While the regulatory measures for
consumer protection are varied in
nature, they could broadly be
categorised into three conventional
g ro u p s , n a m e l y, d i s c l o s u re
regulation, product based regulation
and provider based regulation.
Disclosure regulation largely relates
to the standardisation of information
given out by lenders regarding their
products (Porteous, 2009). This is
aimed at better informing the
consumers and thereby empowering
them to make decisions based on a
better appreciation of the terms and
conditions of the loans. A typical
component of this is usually a
prescription of how interest rates and
other charges should be calculated
and disclosed. Porter (2009) however
brings out an important caveat as he
observes that 'disclosure
requirements work best when
consumers are literate and able to use
effectively the information provided.
But even literate consumers may be
confused by complex choices' (Porter
2009, Consumer Protection in Credit
Markets).
Product based regulation relates to
ZAMBANKER SEPTEMBER 2010
the actual product and the lending
process. It typically includes the
following aspects (Porteus 2009):
! Right to cancel; this includes the
right of the borrower to repay
early with a pre-agreed and often
limited penalty.
! Prohibited behaviour; this entails
the prohibition of certain forms of
selling or collection behavior. In
some cases this has been further
referred to as reckless or
predatory lending. However, the
challenge is often in how to
define such activities.
! Right of grievance redressal: this
mandates credit providers to put
in place clear grievance
procedures for their customers.
This provides effective channels
to resolve credit disputes,
outside the more onerous court
p ro c e s s . T h i s i s u s e f u l
particularly in the case of small
amounts.
In addition to legislative and other
direct frameworks set up by
regulators, there is also a growing
drive towards the development of self
regulation mechanisms in the
financial industry. A case in point is
the launch of an initiative promoted by
micro-finance leaders, investors,
practitioners, researchers and donors
from around the world in 2008 in New
York in 2008 dubbed the 'Campaign
for Client Protection' (Porteous,
2009). The initiative came up with a
set of industry principles based on self
regulation. These included the
following actions;
a) Prevention of over-indebtedness;
b) Transparency in pricing and
advertising of loans;
c) Privacy of client data;
d) Fair loan collection practices;
e) Ethical staff behavior; and
f) Dispute resolution mechanisms
Structure of Consumer Regulation
Different countries have different
structures or regulatory frameworks
for consumer protection in credit
markets. Generally, however, most
countries either have consumer
protection agencies or industry bodies
that self-regulate.
Even countries that have consumer
protection agencies have wide
variations with some countries such as
the United Kingdom (UK) having
general consumer protection
regulators (e.g. the Office of Fair
Trading) working alongside a an
industry specific regulator (e.g. the
FSA for Mortgage Credit) (Porteous,
2009). In South Africa and Mexico,
specialised statutory credit regulatory
agencies attend to consumer
complaints and provide financial
education, among other roles.
In some countries without specialised
regulatory agencies devoted to
consumer protection, industry bodies
play a self regulatory role. These
bodies define standards of lender
behaviour in form of codes of practice
for members.
To be Continued
References
1. Alliance for Financial Inclusion (2010) Policy
Note. Consumer Protection, leveling the
playing field in financial inclusion. www.afi-
global.org
2. Bank of Zambia (2009). Annual Report 2009.
3. Bank of Zambia (2010). Banking and Financial
Services Act. www.boz.zm
4. Bank of Zambia (2010). Banking and Financial
Services Act Microfinance Regulations
(2006).www.boz.zm
5. Bank of Zambia(2010). Circular No. 5/2010 :
Penalty Interest.www.boz.zm
6. Finscope Zambia (2005). Measuring
Financial Access in Zambia. November 2006.
7. Gelbard E. and Leite S. (1999). Measuring
Financial Development in Sub-Saharan
Africa. International Monetary Fund,
WP/99/105, August, 1999.
8. Honahan, P. and Beck, T. (2007). Making
Finance Work for Africa. The Worldbank,
2007.
9. Porteous David (2009). Consumer Protection
in credit Markets, Policy Focus Note 1.
Financial Access Initiative.
www.financialaccess.org
10. National Credit Regulator (2008) Media
Release. March 2008. www.ncr.org.za
11. National Credit Regulator (2008) NCR Act.
www.ncr.org.za

Board Practices & Procedures: A Basic Primer
Dr Kalinde - Assistant Bank Secretary Litigation
By LEONARD NKOLE KALINDE
*
Continued
! Litigation: Court litigation of
corporate disputes and,
e s p e c i a l l y, c ro s s - b o rd e r
disputes, has been replaced to a
large extent by litigation before
international arbitration
tribunals. Both arbitration and
litigation are burdened with the
many drawbacks of court
proceedings, including time and
cost.
! Mediation: Although mediation
Frequently Asked Questions
Mr Kanguya Mayondi, Head of Public Relations
Continued from last Edition
5. Why doesn't Bank of
Zambia take action
against management /
directors involved in
criminal activities and
why is it that the whole
institution is closed in
instances where it is
only the directors at
fault? / Why are
directors and managers
of failed banks not
prosecuted?
! The Bank of Zambia does
not allow persons who
were directly
responsible for bank
failures to hold key
positions in any other
bank or financial
i n s t i t u t i o n s .
Furthermore, the Bank
of Zambia is alive to the
fact that the individuals
directly responsible for
the failed institutions
must be prosecuted. In
this respect, the Bank of
Zambia has in the past
caused the removal from
office and prosecution of
such persons.
! The closure of a bank or
financial institution is
primarily undertaken to
protect depositors' funds
and the financial system.
When a bank is facing
serious liquidity
problems, it is more
beneficial to depositors
and the financial system
to close it than to let it
A BANK OF ZAMBIA JOURNAL
is relatively new and limited in
corporate governance practices,
it can prove useful in preventing
disputes, and could be used
more systematically to efficiently
and effectively deal with
corporate governance disputes.
Mediation (or conciliation) is formally
defined in Article One of the 2002
UNCITRAL Model Law on
International Commercial
Conciliation as: “A process …
whereby parties request a third person
or persons … to assist them in their
continue operating. If
allowed to remain in
operation, depositors
funds may be depleted
and the affected banks
could seriously jeopardise
the entire financial
system and depositors'
funds may be completely
lost.
6. In supervision of banks, is
your approach forward
looking or are you only
looking at a particular
date in the past?
! Bank of Zambia uses a
Risk-Based approach to
supervision of banks
(RBS). RBS is a forward
looking process in that it
provides for an analysis of
the direction that a
particular risk area is
impacting on the bank's
financial condition. Risk-
based supervision
requires a greater
understanding of the
institutions being
supervised and of the
environment in which
they operate. It requires
an understanding of the
risk profile of the
institution under
examination in order to
identify areas of greatest
risk and therefore
deserving of greatest
attention. It requires an
understanding of the
nature of risks, together
with management's
FEATURE/FAQ
attempt to reach an amicable
settlement of their dispute arising out
of or relating to a contractual or other
legal relationship. The conciliator
does not have the authority to impose
upon the parties a solution to the
dispute.”
Mediation has successfully been
introduced to solve commercial,
labour, and cross-border investor
disputes. Corporate governance
disputes could increasingly benefit
from this trend.
Board Evaluation
International corporate governance
standards and codes are increasingly
emphasizing the need for boards to
evaluate their effectiveness. For
example, the UK's Combined Code
states: “The board should undertake a
formal and rigorous annual evaluation
of its own performance and that of its
committees and individual directors.”
Also, financial institutions are
recommending that companies'
boards should undertake regular
evaluations. For example, the US
Teacher Insurance and Annuity
Association– College Retirement
Equities Fund's (TIAA-Cref) Policy
Statement on Corporate Governance
ability to deal with both
internal and external
risks. Under the risk-
based approach, the
supervisor is able to
assess whether the risk is
increasing, stable or
decreasing.
7. How effective is bank
supervision? / Is Bank of
Zambia supervising
banks properly?
! Bank supervision has
been made effective over
the years through:
o The enactment of
the Banking and Financial
Services Act of 1994
(BFSA) and the
accompanying Statutory
Instruments. The BFSA
was strengthened by the
amendment in the year
2000.
o The inspection of banks is
now risk focused. Risk-
based supervision assigns
the highest priority to
areas of highest risk.
o Banks that do not conform
to the rules and
regulations are penalized
or closed.
o Zambia is substantially in
compliance with the Basel
Core Principles for
Effective Banking
Supervision (i.e.
international best practice
principles). The Core
Principles comprise
twenty-five basic
Principles that need to be
in place for a supervisory
system to be effective.
This is regarded as global
supervisory best practice.
o The enactment of the
Prohibition and
Prevention of Money
Laundering Act of 2001 is
aimed at curbing the
crime of money
laundering and financing
of terrorism.
o Continuous review of the
law in line with the
current developments in
the financial sector has
resulted in the various
directives and guidelines
11
states:
“The board should conduct an annual
evaluation of its performance and that
of its key committees. Evaluation
criteria linked to board and committee
responsibilities and goals should be
set forth in the charter and governance
policies. In addition to providing
director orientation and education, the
board should consider other ways to
strengthen director performance,
including individual director
evaluations.”
An evaluation should have clear terms
of reference for the:
! Board
! Individual director performance
! CEO
! Chairman
The evaluation should also state the
reasons why it is being undertaken.
Typical reasons may include:
! Identifying board weaknesses
and providing the board with an
opportunity to take action to
improve itself;
! Allowing the board to assess the
value it creates for the company
and the efficiency of its internal
functioning;
being issued e.g. Anti-
money laundering
directives, corporate
governance guidelines
etc. Continuous capacity
building for all
supervisory staff.
8. How does Bank of Zambia
monitor/ supervise
banks?
! The Bank Supervision
department supervises,
regulates and monitors
banks by using a
combination of two main
methods namely, On-site
examination and off-site
monitoring mechanism.
This is in fact a
prerequisite for effective
banking supervision and
is regarded as
international best
practice.
o O f f - s i t e
monitoring is intended to
provide an early warning
system. It is a method of
monitoring or evaluating
banks' performance using
periodical prudential
reports and statistical
returns submitted by
bank management.
o On-site inspections
involve verification of the
accuracy of reports
received through planned
or impromptu visits to the
banks' offices.
9. Why do foreign exchange
rates differ between
banks?
! Foreign exchange rate is a
price for trading in foreign
currency; therefore, the
price is bound to differ
from bank to bank
depending on various
business reasons affecting
demand and supply.
10. What is the minimum
capital required to set up
a commercial bank?
! The minimum primary
paid-up capital was
revised to K12 billion from
K2 billion as of 2nd January
2007. To be Continued
! Acting as an early warning
system, which will allow
changes to be implemented
before problems set in;
! Identifying and overcoming any
differences among board
members;
! Leading some directors to
conclude that they are neither
able nor willing to invest in the
time and effort to add value to the
board, and decide that the
company's interests would be
better served by a change in
board personnel.
Typical questions that directors
should ask prior to an evaluation
include:
! Is the board clear about its
function and responsibilities?
! Is each director clear about their
role?
! Do the committees understand
their roles?
! What performance metrics will
be used?
! Who will collect the information?
! How will the information be
collected?
A typical evaluation process is led by
the chairman, but frequently
o u t s i d e e x p e r t s p ro v i d e
a s s i s t a n c e . T h e p ro c e s s
comprises:
! An evaluation instrument
! A board presentation involving a
description of the process
! A questionnaire, which directors
complete individually and
privately
! One-on-one confidential
interviews
! Data collection and analysis
! A presentation and board
discussion involving the
development of a plan to remedy
any identified deficiencies
One technique for reducing directors'
opposition to the evaluation process
is to recast them as “performance
improvement plans” (PIPs). These
plans emphasize that the exercise's
objective is to improve performance
rather than criticizing performance or
behavior. Treating reviews as a
forward-looking planning process,
rather than a backward looking
critique, may make the process
appear more goal oriented and
positive.
Board evaluations are inevitably
challenging for board members. The
evaluation process can be made
easier, however, by using facilitators,
and by treating it as a forward looking
p ro c e s s w h o s e g o a l i s t h e
improvement of the board's workings,
rather than an implicit critique.
Common reasons why evaluations do
not take place include:
! Some directors may feel
uncomfortable about being
evaluated
! Day-to-day pressures cause the
board to delay the evaluation
! Evaluation may be perceived as a
sign that the board lacks trust or
confidence in the CEO's
performance
! The board feels it lacks the skills
and expertise to undertake
effective evaluations
! The board has not been
emphasizing planning or
evaluation. There are no
performance targets for the
board, committees, or executive
managers
! Dysfunctional board
! The CEO, chairman, and/or
founder may be dominating the
board and be concerned about
the issues that an evaluation may
raise
! Previous board evaluations were
ZAMBANKER SEPTEMBER 2010
ineffective
Characteristics of successful
evaluations include:
! The purpose, objectives,
process, and outcomes have
been fully explained and
discussed with all concerned
parties
! Strict confidentiality is
maintained at all times
! The chairman and the CEO play a
key role in developing and
approving the process
! Regular, annual review
! Benchmarks of board,
committee, executive, and
company effectiveness should be
used as performance indicators
! A written format that is discussed
by all concerned parties
! The chairman should provide the
full board with a report
! The process itself should be
evaluated for improvements to be
undertaken in the following year
Conclusion
This paper has attempted to highlight
best board practices and procedures
that could assist organisations achieve
good corporate governance standards.
Shareholders, directors and senior
management should be champions for
good corporate governance in their
organisations. They should realise that
both domestic and foreign investors
place an ever greater emphasis on the
way that corporations are operated and
how they respond to their needs and
demands. Investors are increasingly
willing to pay a premium for well-
governed companies that adhere to
good board practices, provide for
information disclosure and financial
transparency, and respect shareholder
rights. Therefore, good corporate
governance is essential in
establishing an attractive investment
climate that is characterised by
competitive companies and efficient
financial markets.
To Be Continued
*
PhD (Kent), LL.M (American), LL.B
(UNZA); Advocate and Commissioner for
Oaths; Commonwealth and USAID
Scholar; Assistant Bank Secretary
(Litigation) at Bank of Zambia. The
Interpretation and conclusions
expressed in this paper are entirely
those of the author. They do not
represent the views of the Bank of
Zambia, its Board or Management.
Corporate governance is defined as
Corporate governance refers to the
mechanisms through which corporations
(whether private, publicly traded, or state-
owned) and their management are
governed. It involves a set of relationships
between a company's management, its
board, its shareholders, and its other
stakeholders, and also provides the
structure through which the objectives and
the monitoring of performance are
determined.
Henry Bosch, The Director at Risk
(Melborne:Pitman, 1995) p.142
Jon J. Masters and Alan A. Rudnick,
Improving Board Effectiveness: Bringing
the Best of ADR into the Boardroom – A
Practical Guide for Mediators
(Washington, DC: American Bar
Association, 2005).
Eric Runesson and Marie Laurence Guy,
Mediating Corporate Governance
Conflicts and Disputes (Washington, DC:
Global Corporate Governance Forum,
2007). Available at: www.gcgf.org.
L. Bouchez and A. Karpf, Exploratory
Meeting on Resolution of Corporate
Governance-Related Disputes
(Stockholm: OECD, March 2006).
Available at: http://www.oecd.org.
Official Records of the Genral Assembly,
Fifty-seventh Session, Supplement No. 17
(A/57/17), annex I.
“The Combined Code” (London: Financial
Reporting Council, 2006), p.9. Available
at:www.ecgi.org/codes/all_codes.php.“P
olicy Statement on Corporate
Governance” (New York: Teacher
Insurance and Annuity Association –
College Retirement Equities Fund, 2007),
p . 1 4 . A v a i l a b l e a t w w w. t i a a -
c r e f. o r g / p u b s / p d f / g o v e r r n a n c e _
policy.pdf.
 PHOTO FOCUS

Governor Caleb Fundanga, together with Bank of China General Manager Wang Hongwei and BoC Board Member Deputy Governor - Administration Dr. Tukiya Kankasa-Mabula (front row, 3rd from r) treated former Director - Audit
Chita Chibesakunda sharing a light moment during the Chairpersons’ luncheon at Hotel Intercontinental in Lusaka Department Mrs. Avet Hamuwele (front row, 2nd from r) to lunch at Sandy’s Creations. in attendance were some
Directors and Assistant Directors at the Bank

Director at ZESCO, Mr. Masiye Mwale seems to be giving Members of Parliament and BoZ staff members an Governor Caleb Fundanga congratulating one of the happy winners of cash prizes during the draw of the Bank of
impromptu lesson in the chinese language during a familiarization tour of the Kariba North Bank expansion Zambia quiz at the Lusaka Agricultural and Commercial Show
project in Siavonga

During the show in Lusaka, the Governor took time to visit all the players in the financial sector who had mounted Mr. Musapenda Phiri of the FSDP Secretariat at BoZ explains some aspects of the Top Line findings during the
exhibitions. above, Governor Fundanga poses with members of staff of ZANACO after visiting the bank’s stand Copperbelt launch of the Finscope Zambia 2009 - Top Line Findings in Ndola recently

Chairpersons of commercial banks, together with Governor Fundanga and members of the BoZ team, Regional Director Morris Mulomba (2nd from l) handing a gift to Mr. Mathews Zulu during the latter’s farewell f
posing for a group photograph after the luncheon at Hotel Intercontinental in Lusaka recently unction in Ndola. looking on are Mrs. Zulu (2nd from r) and Assistant Director - HRA Mr. Patrick Mulenga (l)

A BANK OF ZAMBIA JOURNAL 12 ZAMBANKER SEPTEMBER 2010


Zambia attractive investment location-Chinese bank
Governor Caleb Fundanga compares “notes” with Chairpersons of commercial banks at the luncheon held at Hotel Intercontinental in Lusaka, while
By Zambanker reporter
Zambia has been described as
one of the most attractive
investment locations in Africa
Mudenda Reviews Polymer Performance
By Zambanker reporter
Director, Banking Currency
and Payment Systems Mrs
Edna Mudenda has said the
K1000 and K500 low value
polymer banknotes have
performed as anticipated and
have remained relatively
longer in circulation when
compared to other low value
paper banknotes.
Reviewing the performance of
polymer notes recently, Mrs
Mudenda reiterated the Bank
of Zambia's commitment to
ensuring that banknotes of
high quality are issued to the
general public. She added that
at the time of introduction, the
public did not easily accept the
“plastic” banknotes and that
the Bank had to undertake,
and continues to undertake
several currency campaigns to
sensitise the public on the
benefits of polymer
banknotes.
She said currently, the two
banknotes were widely
accepted, such that even when
the notes fade on account of
wearing out of the ink, the
public continued using them.
Low value notes are mostly
used for purposes of acquiring
change in smaller
denominations.
Initially, the low value notes
were printed on paper
substrate, until the
A BANK OF ZAMBIA JOURNAL
Deputy Governor - Operations Dr. Denny Kalyalya keeps vigil
by a leading Chinese Bank.
Bank of China (BoC) General
Manager, Mr Hongwei Wang
said Zambia's investment
introduction of the polymer
substrate in 2003. At the
introduction of polymer note
use, circulation was infused
side by side with paper notes
in the two denominations until The Bank of Zambia has the
the complete withdrawal of
paper notes. The exercise of
withdrawing the paper notes
was, by 2005, accomplished.
“An in-house study was
conducted in 2006 to
determine the durability of
polymer banknotes using
K1000 and K500 polymer
banknotes. The study
established that the
proportion of unfit banknotes The Family of Banknotes – Paper banknotes
on account of fading was
small, amounting to only 6.2
per cent and 4.8 percent of a
sample of 20 thousand pieces
each for the K1000 and K500,
respectively” she said.
The Director explained that
polymer banknotes last longer
in circulation than paper
banknotes, accounting for
about 12 to 16 months while
in circulation, which was three
to four times longer than
paper banknotes. She added
that paper notes could not be
processed on automated
machines due to heavy soiling,
and that processing of paper
notes needed to be done
manually. Another advantage
she cited was their
characteristic of generally not
being prone to mutilation,
unless subjected to extreme
conditions.
She, however, added that due
to rubber banding of
banknotes, efficiency was
affected when processing
them on the automated
machines. She advised that
automated machines needed
to be calibrated and that this
was currently proving to be a
challenge in that there was no
recycling of substrate to make
plastic products in Zambia, as
was the case in other
countries. Consequently,
polymer is mixed with paper,
shredded and disposed of by
landfill.
The Director added that it was
encouraging, however, to note
that members of the public
were currently surrendering
NEWS
attractive investment
destinations in Africa”, Mr
Wang said.
Mr Wang was speaking at
L u s a k a ' s H o t e l
Intercontinental at a Quarterly
Luncheon for Commercial
Bank Chairpersons held in
September 2010 and
sponsored by BoC.
He said his institution would
continue to contribute to the
country's economic
development through the
provision of financing to local
businesses and the payment of
taxes for the well-being of the
Zambian people.
Mr Wang said the economic
strides Zambia was making
were also as a result of the
existing healthy and dynamic
financial system under the
efficient supervision of the
Bank of Zambia.
And Bank of Zambia Governor,
Dr Caleb Fundanga thanked Mr
Wang for his kind words,
noting that it was not too often
that regulators were lauded for
their work.
potential had been supported per cent. He thanked BoC for making it
by economic fundamentals like “Zambia recorded a six percent possible that Chairpersons of
last year's Gross Domestic GDP last year and the country the 18 commercial banks
Product (GDP) growth of six has become one of the most registered in Zambia could
meet and review happenings
of the last quarter in a cordial
manner.
The luncheons have become
tradition amongst commercial
banks in Zambia and are
faded notes to the Bank of arrangements as may be sponsored by a different bank
Zambia through commercial necessary for the printing of on each occasion.
banks for subsequent notes, the minting of coins and And in his review of the period,
destruction after for the issue, re-issue, the Governor said inflation had
authentication. exchange and destruction of slowed to 7.8 per cent at the
notes and coins, and for the close of the second quarter
exclusive power to issue the safeguarding thereof.' from 10.2 per cent in the
currency which is the legal Having successfully previous quarter ending March
tender in Zambia, namely the transcended the barriers of 2010.
Kwacha. The mandate to printing all the Zambian D r Fu n d a n g a s a i d t h e
manage the national currency banknotes on the traditional favaourable outcome was
is drawn from Section 32 of cotton based paper substrate, largely on account of the fall in
the Bank of Zambia Act of the country is the first country food inflation to 3.8 per cent in
1996, which states that 'the in Africa to adopt polymer the second quarter from 9.3
Bank shall have all such banknotes. percent recorded in March
powers and make all such 2010.
The slowing of food inflation
was mainly driven by reduced
prices of maize, millet,
Denomination (K) Comment breakfast and roller meal,
various vegetables and
Paper mutton, following the increase
in seasonal supply of the
50,000 High value note introduced in 2003 products.
Developments in commercial
bank nominal interest rates
20,000 Same as the 50,000 were said to have been mixed
during the second quarter but
10,000 Middle value note, upgraded in 2008 by still recorded a decrease in the
replacing the multi redundant hologram with a weighted average lending base
metallic strip
5,000 Middle value note upgraded in 2003 with
security features and durability BOZ Board gets members
From Page 2
100 Low value note for change purposes and financial system of the
country.
50 Same as the 100 Dr Situmbeko Musokotwane
also appointed Dr Dennis
Chiwele to the Board of
20 Same as the 50, although this note currently
is Directors of the Bank of
not in wide circulation due toits low purchasing st
Zambia effective 31 July,
power 2009 for a period of three
years. In his letter of
Denomination (K) Comment appointment to Dr Chiwele,
the Minister trusted that Dr
Polymer Chiwele would assist the Bank
provide the vital leadership
expected of it in the
1,000 • Low value note used for change purposes,
strengthening and
initially was printed on paper substrate, development of the banking
introduced on polymer substrate in 2003. and financial system of the
• Paper and polymer banknotes circulated side country.
by side in this denomination. Further, the 302 n d Board
• Withdrawal from circulation took place as Meeting appointed Dr Chiwele
to the Monetar y Policy
and when the paper K1,000 banknotes were
Advisory Committee, whose
deposited at the central bank. functions include providing
• By 2005, paper notes were virtually sound advice to the Board on
withdrawn from circulation and therefore, monetary issues, reviewing
and recommending
none are in circulation.
appropriate monetary policy
objectives, assessing the
500 Same as the 1,000
performance of monetary
8 ZAMBANKER SEPTEMBER 2010
rate (WALBR) to 21 per cent
from 22.5 per cent as recorded
in the previous quarter.
The average lending rate also
declined to 27.7 per cent as at
end June from 29 per cent in
March.
In the foreign exchange
market, the Kwacha
depreciated against major
traded currencies except for
the euro, thus reversing gains
made in the previous quarter.
The Kwacha depreciated by 9.1
per cent against the US dollar,
ending the period at an average
of K5,122.89.
H o w e v e r, t h e G o v e r n o r
reported that latest data for
end of July showed that the
rate of depreciation for the
Kwacha to US dollar had
slowed down, to the point of
posting marginal gains by the
end of August.
“As at the close of the trading
session on 27 August, 2010 the
Kwacha was trading at
K4,974.32 against the US
dollar in the interbank
market”, Dr Fundanga said.
In the real sector, the Governor
said most of the selected
indicators of economic activity
during the second quarter
recorded an increased output.
For instance, during the second
quarter of 2010, copper output
rose by 0.7 per cent to 189,257.
3 metric tones (mt) from
188,088.1 mt the previous
quarter, while in
manufacturing, cement
production increased by 18.5
per cent to 185,702 mt from
156,706 mt during quarter
one.
In the agriculture sector,
results of a Crop Forecasting
Survey for 2009/2020
agricultural season indicated
that maize production
increased by 48 per cent to 2.8
million mt from 1.8 million mt.
Regarding the financial sector,
he said the overall financial
condition of the banking sector
was satisfactory, although
financial performance
recorded deterioration
compared to the previous
quarter.
The Credit Reference Bureau
Africa Limited held a meeting
with Chief Executive Officers of
banks and their credit officers.
Following this meeting, the
organisation reported a 1,000
per cent improvement in the
submission of credit reports by
the banking sector.
policy over the previous six
months and recommending
measures that may enhance
the credibility and objectivity
o f t h e M o n e t a r y Po l i c y
Statements as submitted to the
Minister of Finance and
National Planning in
accordance with the Bank of
Zambia Act.
Dr Chiwele holds a doctorate
degree in Philosophy of
Development Economics from
the Institute of Development
Studies at the University of
Sussex in Brighton, United
Kingdom. Dr. Chiwele is also a
holder of a Masters Degree in
International Economics from
the International University of
Japan in Uraasa, as well as an
under graduate degree in
Economics with Distinction
from the University of Zambia.
Dr Chiwele has, hitherto,
conducted consultancy
assignments both within and
outside Zambia for a numerous
number of organisations.
 FEATURE

Kalyalya commends BSA

By Zambanker reporter
Deputy Governor-Operations,
Dr Denny Kalyalya has said the
Bank Supervision Application
(BSA) has so far played a vital
role in helping bank
supervisors in member
countries to efficiently collect,
store and manage prudential
information from the
supervised institutions.
Speaking at the official
opening of the BSA
stakeholders meeting hosted
by the Bank of Zambia in
Livingstone recently, Dr
Kalyalya said the BSA had
demonstrated its effectiveness
and potential to benefit the
supervisors in a number of
ways including data integrity,
consistency, validation and
security of data and
information.
He further appealed to all
stakeholders to continue
helping the BSA Support Office
in order to enhance and deliver
an efficient and effective
system.
The BSA is an information
technology platfor m for
regional central banks used in
the collection and risk analysis
of supervisory information
from the supervised financial
institutions, such as
commercial banks.
The BSA Annual Stakeholders'
meeting, which rotates among
the member countries, is
intended to provide a platform
for BSA stakeholders to discuss
issues affecting the
implementation and use of the
system over the past year.
Prior to the 2010 Stakeholders'
Meeting, the BSA Executive
Committee (BEC) met in
August 2010 at the same
venue.
The role of the BEC, which is
comprised of Zimbabwe,
Zambia, Kenya and
Mozambique, is to provide
strategic and operational
direction to the BSA Support
Office (BSO), hosted by the
Central Bank of Mozambique
and which holds the
intellectual property rights of
the BSA on behalf of the
stakeholders.
T h e D e p u t y G o v e r n o r,
h o w e v e r, s a i d t h e s e
achievements had not been
without their own challenges.
He said the implementation of
the BSA Version 1 was
problematic to the BOZ
because of some technical
problems.
“The system was not capable
of performing some of the
critical functions in bank
supervision. For instance, both
the Risk Automation and
Analysis System (RAAS) and
the Bank Supervision
Application System (BSS)
modules had challenges,
which impacted negatively on
the pace of the rollout. I am
reliably informed that these
problems may have not been
unique to Zambia”.
Dr. Kalyalya also said that the
B S A Ve r s i o n 2 . 1 , w a s
introduced to remedy the
shortcomings of BSA Version 1.
He added that BSA Version 2.1
also faced a number of
challenges, some of which
were that the system failed to
meet all the users'
expectations, non-
functionality of certain
expected operations, slow
processing speed, and that
some ratios in RAAS could not
be easily calculated. All these,
he said added to the IT related
technical problems which were
encountered along the way.
Nevertheless, Dr Kalyalya said
it was heartening to note that
despite the many challenges
encountered, the BSA Support
Office had endeavoured to
ensure that all the BSA
m e m b e r- c o u n t r i e s m a ke
reasonable strides with regard
to the implementation of the
system. Further, the BSA
Support Office has, to a large
extent, accommodated the
requirements of the various
stakeholders' needs.
He added that the BSA Support
Office was currently working
on the BSA Version 3, which is
expected to be more robust in
terms of workflows and other
processes. He expressed hope
that upon completion, the BSA
Version 3 would overcome the
challenges faced by the
currently applicable systems.
“It is our wish that the system
will be developed in such a way
that it becomes a one-stop
centre for supervisors to do all
their supervisory work. It must
be capable of being fully
integrated with common
Microsoft Office applications,
such as, the mail system. In
addition, all the common
supervision processes such as
licensing and regulation, on-
site inspections and off-site
surveillance should be fully
integrated in order for it to
enhance the risk-based
supervision of supervised
institutions,” he said.
He further said the BSA
Support Office should enhance
the user manuals to make
training of new users easier.
He said dedicated instruction
manuals should also be
developed for users from
central banks, as well as
supervised institutions.
“The recent global financial
and economic crises
demonstrated the urgent need
for timely access to reliable
information at all times. Going
forward and in order to remain
relevant, the BSA should
incorporate the following
capabilities: statistical and
forecasting capability; bank
valuation; risk modelling and
macro prudential analysis.
The BSA was conceptualised
by the SADC IT Forum as early
as 1997. In the subsequent
years, a team comprising of
bank supervisors and ICT
administrators was organised,
and was tasked to develop this
infor mation management
solution which has since
transformed the region's
supervisory landscape in terms
of effectiveness and quality of
risk analysis in banking
supervision. The BSA was
initially deployed in 2003.
There are currently eleven (11)
Stakeholder member countries
using the BSA. These are
Zimbabwe (Chair), Kenya (Vice
Chair), Zambia, Mozambique,
Uganda, Swaziland, Lesotho,
Namibia, Malawi, DR Congo
and Cape Verde. Further, the
BSO during the year hosted and
conducted a site visit to the
Central Bank of Seychelles for
B SA d e m o n s t r a t i o n a n d
awareness. As a subsequent
result, the Seychelles was
formally admitted as the
twelfth member of the BSA
Stakeholders during the
meeting in Livingstone.

Training Update
By Zambanker reporter employees have so far
Training of staff in any successfully completed their
organization including the studies this year, and seven
Bank of Zambia, is important in have already proceeded on full
that it helps companies to train time studies.
have more productive and The following is a list of
qualified employees. members of staff who have
The Bank of Zambia has successfully completed their
employees who go for further studies and those who have
Studies in various programmes proceeded on full time studies:
Participants to the stakeholders meeting pose for a group photo with Deputy Governor Operations
every year.
Bank of Zambia Training PhD in Economic

Interest rate determinants revealed

Manager, Patson Banda told Anthony Simpasa
the Zambanker that 14 Jonathan Chipili

Masters Degree Programmes

Name Course Department From Page 1 is partly supported by a would need to be considered: economic system like Zambia,
1. Chishimba Yumbe MA in Public Policy Finance
that there was a strong link correlation coefficient of 0.72 The need for improvement in macroeconomic factors
and Management
2. Eric MBA (Heriot Watt) Finance between the weighted lending between weighted lending the transparency and should dominate the
Masumbu base rate (WLBR) and inflation base rate and open market credibility of the BoZ monetary determination of rates.
3. Danny Kaliba MBA (Heriot Watt) Financial Markets and a strong positive operations rates,' Dr Pamu said. policy in order to anchor In this regard, commercial
4. Lyness Mambo MBA (Heriot Watt) Bank Supervision relationship between the Other issues that arose from inflationary expectations, the banks were urged to develop
5. Bertha Chisola MBA (Heriot Watt) Internal Audit
treasury bill yield rate and the the survey included a need for further development formal frameworks for the
6. Diana Chisulo MBA (Heriot Watt) Finance (R/O)
7. Felix Sinkala MBA (Heriot Watt) Finance WLBR. suggestion from banks for the of the money market for interest rate decision-making
8. Muuka Madubeko MBA (CBU) BCPS 'Even though half of the banks credit culture to be improved, effective and efficient process.
9. Besnat Mwanza MBA (Nelson Mandela Bank Secretariat Dr Pamu said that BoZ, on its
Metropolitan) surveyed indicated that they among other things, by interactions between
consider inflation when setting widening the scope of commercial banks and BoZ, part, will continue to foster
ACCA lending rates, our analysis information captured by the and the need for the competition by encouraging
Name Course Department suggests a strong link between Credit Reference Bureau. Most development of a deeper and the entry of new banks for the
1. Florence Pandala ACCA Finance the WLBR and inflation and banks indicated that although liquid secondary market. purpose of improving the
2. Harriet Chishimba ACCA Financial Markets also a strong positive the introduction of the BoZ It was clear from the survey provision of banking services.
relationship between the overnight facility was a that there were several issues
ACT treasury bill yield rate and the welcome development, the that required to be addressed
WLBR. Correlation coefficient margin that was added to the before a significant reduction
Name Course Department between the two is 0.75 and interbank rate was too high. in lending rates on the market
1. Kabwe Kandeke ACT Bank 0.89 respectively,' Dr Pamu Banks also noted that the could be visibly observed and
Supervision said. interest rate on the overnight more importantly before an
Employees who have Proceeded on Full Time Studies this Year
Key implications of the findings facility should be effective interest rate targeting
for the interest rate targeting independently determined framework could be
Name Course
Department
framework were that a policy with the policy rate as a implemented.
rate that was linked to the reference. And on the issue of the high
1. Abel PhD (Economics) University of Economics interbank or overnight facility Further, operational costs in interest rates, it was pointed
Shimba International Business and Department
Economics – China
Economics – China
rate may not have the desired the banking industry were out that banks needed to
2. Ernest MA in Banking and Finance (Moi NBFI effects on interest rates in the found to be high and that this improve efficiency by lowering
Chisongo University)
economy and that the use of had a bearing on the operational costs and that they
3. Patrick MA in Banking and Finance (Moi BCPS qualitative or judgemental determination of the base should be consistent in the use
Phiri University) factors in the interest rate lending rates. of macroeconomic factors such
4. Eddie MSc in Project Management ICT decision-making process may 'The high operational costs may as inflation, exchange rates and
Bwalya (CBU) dampen the intended effect of a be a reflection of inefficiencies treasury bills. All things being
5. Donald BA in Development Studies Security
policy decision. For this reason, in the banking industry, which equal, it was expected that
Mandeva (UNZA) a policy rate linked to either the banks could be passing on to when inflation or treasury bill
interbank or the overnight their clients in the form of high rates were low, lending rates
facility rate would be lending rates,' the Director should also be adjusted
6. Maeke BA in Development Studies Security ineffective. added. downwards.
Njunju (UNZA)
'The option available for the Commercial banks indicated Dr Pamu also mentioned that
policy rate is linking the policy that in order for the interest while qualitative factors were
7 Charles BA in Development Studies
Mukuka (UNZA) Security rate to the open market rate targeting regime to be important in the determination
(R/O) operations rate. This possibility success, the certain factors of lending rates, in a liberalised Dr Pamu

A BANK OF ZAMBIA JOURNAL 9 ZAMBANKER SEPTEMBER 2010

 PHOTO FOCUS

Deputy Governor - Operations Dr. Denny Kalyalya explaining developments in the economy to journalists at a press First Republican President Dr. Kenneth Kaunda receiving a gift from Head of Public Relations Kanguya Mayondi
briefing in the Bank’s stand during Lusaka Agricultural and Commercial Show before leaving the BoZ stand at the Lusaka Agricultural and Commercial Show

Members of the Regional Office Managers’ Circle captured in a relaxed mood at the scenic Mutanda Waterfalls in
Solwezi recently Part of the contingent of Parliamentarians and BoZ staff listening attentively during the Bank’s Seminar for MPs in
Siavonga

The Bank of Zambia team which participated in festivities to mark the commemoration of World Population Day in Head of Public Relations, Kanguya Mayondi (l) receiving “some valuable tips” on the trade from former Head of
Lusaka take time off to pose for a momentous group photograph at Mulungushi Inter9national Conference Centre Public Relations and current Minister of Foreign Affairs, Hon Kabinga Pande at the Lusaka Agricultural and Commercial

Deputy Governor - Administration Dr, Tukiya Kankasa-Mabula conferring with Hon. B.Y. Mwila and Hon. Geoffrey Members of the Bank of Zambia team who represented the institution at the Lusaka Agricultural and Commercial
Mwamba during the Seminar for MPs in Siavonga Show pose with Governor Fundanga at the BoZ stand

A BANK OF ZAMBIA JOURNAL 13 ZAMBANKER SEPTEMBER 2010

 VESS/ORBITUARY

Separation from the Bank List of Banks and Other Financial

Zambanker reporter
Five members of staff
separated from the Bank
during the third quarter of
2010 of which four
separated through the
Voluntary Early Separation
Scheme (VESS) and one
resigned.
Those who took VESS are
Mr Boaz Musamvu, Mr
Re u b e n M b e w e , M r s
Mirriam Banda and Ms
Mwango Kasutu while the
one who retired is Mr
Graeme Mutantabowa.
Mr Mutantabowa resigned
from the Bank on July 2,
2010 after working for
over 8 years.
His last appointment was
that of Assistant Manager
– Maintenance in the
Procurement and
Maintenance Ser vices
Department.
Mr Musamvu left the Bank
on August 31, 2010 after
working for over 18 and
half years. At the time of
leaving the Bank, Mr
Musamvu was an Assistant
Manager – Planning in the
Executive Office.
Mr Reuben Mbewe left the
Bank on August 31, 2010
after working for over 17
years.
He was a note examiner in
the Banking, Currency and
Payment Systems
Department at the time of
separating from the Bank.
Mrs Banda left the Bank on
September 24, 2010 after
working for almost 18
years. Mrs Banda was a
stenographer at the time of
separating from the Bank
in the Procurement and
Maintenance Ser vices
Department.
Ms Mwango Kasutu left the
Bank on September 30,
2010 after working for 15
Mr Musamvu
Mr Mbewe
years. She was a
Technologist – Electronics
in the Procurement and
Maintenance Ser vices
department at the time of
her separation.
Ten security officers who
were on secondment
separated from the Bank
on July 28, 2010 after their
contracts expired.
The ten, who separated
after working for 2 and half
years, are Mr Davies
Service Providers
Licenced Under The Banking and Financial Services Act, Cap 387 of the Laws of Zambia
A. Commercial Banks
Names of Banks Head Office Address Tel No:
1 Access Bank Zambia Ltd P O Box 35273
2 African Banking Corporation Zambia Ltd P O Box 39501, Lusaka 234541, 232991-3
3 Bank of China Zambia Ltd P O Box 34550, Lusaka 235350
4 Barclays Bank Zambia PLC P O Box 31936, Lusaka 228858-66, 227659- 61
5 Cavmont Capital Bank Zambia Ltd P O Box 32222, Lusaka 224280/6/7
6 Citibank Zambia Ltd P O BOX 30037, Lusaka 229025-8
7 Ecobank Zambia Ltd Stand No. 22768 (Formerly FTJ Chiluba Institute) Corner Great East/Thabo Mbeki Roads
8 Finance Bank Zambia Ltd P O Box 36762, Lusaka 221808/ 229733 42
9 First Alliance Bank Zambia Ltd P O Box 33959, Lusaka 229303-6
10 First National Bank Zambia Ltd P O Box 36187
11 Indo-Zambia Bank Ltd P O Box 35411, Lusaka 224653/225080/ 228074/224652
12 Intermarket Banking Corporation Zambia Ltd P O Box 35832, Lusaka 227227-8
13 International Commercial Bank of Malaysia
14 Investrust Bank Zambia Ltd P O Box 32344, Lusaka 238733/5
15 Stanbic Bank Zambia Ltd P O Box 33611, Lusaka 229285-6
16 Standard Chartered Bank Zambia PLC P O Box 32238, Lusaka 222046/229242-60
17 United Bank for Africa Zambia Ltd Stand No. 22768 (Formerly FTJ Chiluba Institute) Corner Great East/Thabo Mbeki Roads
18 Zambia National Commercial Bank Ltd P O Box 32111, Lusaka 221355
NON BANK FINANCIAL INSTITUTIONS LICENCED BY BANK OF ZAMBIA
Licenced Under The Banking and Financial Services Act of 1994 (and as amended in 2005)
Mrs Banda
A. LEASING COMPANIES POSTAL ADDRESS TEL. FAX
1 ALS Capital Limited P O BOX 31986, Lusaka 0211-222807 0211-236726
2 Afgri Leasing Services Limited P O Box 37956, Lusaka 0211-240331 0211-240321
3 Commercial Leasing (Z) Limited P O Box 38293, Lusaka 0211-229427 0211-229428
4 Commercial Capital Corporation Ltd P O Box 36706, Lusaka 0211-225429 0211-225429
5 Executive Financial Services Limited P O Box 39275, Lusaka 0211-230631 0211-230634
6 Industrial Credit Corporation Limited P O Box 75543, Ndola 0212- 611233 0212-618621
7 IMS Financial Services Limited P O Box 35722, Lusaka 0211-286562 0211-286565
8 Leasing Finance Company (Z) Limited P O Box 72543, Ndola 0212-618844 0212-615481
9 Madison Premier Finance Company Ltd P O Box 34738, Lusaka 0211-255121 0211-255121
10 Alios Finance Zambia Ltd P O Box 33703, Lusaka 0211 256592 0211-256682
11 Stechas Financial Services Zambia Ltd P O Box 33604, Lusaka 0211-222736 0211-222736
B. BUILDING SOCIETIES
1 Finance Building Society P O Box 31060, Lusaka 0211-239755 0211-239756
2 Pan African Building Society P O Box 30053, Lusaka 0211-220690 0211-220688
3 Zambia National Building Society P O Box 30420, Lusaka 0211-229191 0211-225510
C. MICRO FINANCE INSTITUTIONS
1 Bayport Financial Services Limited P O Box 33819, Lusaka 0211-212772 0211-212713
2 Blue Financial Services Zambia Limited P O Box 30516, Lusaka 0211-232082 0211-232083
3 Bomach Finance Limited P O Box 36298, Lusaka 0211-222802 0211-223039
4 Butala Finance Limited P O Box 35087, Lusaka 0211-235273 0211-235130
5 Capital Solutions Limited P O Box 34366, Lusaka 0211-231983 0211-231986
6 Cetzam Financial Services Limited Private Bag E760, Lusaka 0211-222991 0211-222961
7 Elpe Finance Limited P O Box 35560, Lusaka 0211-237505 0211-237505
8 FINCA Zambia Limited P O Box 50061, Lusaka 211-251828 211-251736
9 Letshego Financial Services Limited P O Box 51499, Lusaka 0211-257741 0211-257735
Ms Kasutu
10 Meanwood Finance Limited P O BOX 31334, Lusaka 211-236165/7 211-236170
Chimota, Mr David Phiri, 11 Mtawila Financial Services Limited P O Box 30958, Lusaka 26 0955 830005 26 0977 832000
Ms Mirriam Mukwasa and 12 Microbankers Trust P O Box 51122, Lusaka 0211-290852 0211-291393
Ms Caroline Mashakalati. 13 Microfin Africa Zambia Limited P O Box 32482, Lusaka 0211-227691 0211-227694
14 Nedfin Limited P O Box 37029, Lusaka 0211-234306 0211-234307
Others are Mr Victor 15 Pelton Finance Limited P O Box 320187, Lusaka 0211-237031
Chisenga, Mr Pontino 16 Pulse Financial Services Limited P O Box RW 51269, Lusaka 0211-233137/8 0211-233136
Phiri, Mr Felix Shantimba,
17 Royal Microfinance of Zambia Limited P O Box 32188, Lusaka 0211-228455 0211-228456
18 Unity Finance Limited P O Box 35721, Lusaka 0211-233084 0211-221179
Ms Veronica Lungu, Mrs 19 Yakabutala Musa Limited P O Box 36634, Lusaka 0977 494340
Maggie Zimba and Mr 20 Genesis Finance Limited C/O Lukona Chambers, Lsk 211-845653 211-845653
21 Microcredit Foundation Limited P O Box 510637, Chipata 0976 294311
Conrad Lianda. 22 Prime Circle Microfinance Limited P O Box 34959, Lusaka 0211-281694 0211-281694
Zambanker wishes all 23 Kungoma Financial Services Limited P O Box FW 260, Lusaka 260 211 235195
employees who separated 24 Credit Finance Limited P O Box 50713, Lusaka 260 211 233420 260 211 222202
25 Wide and Deep Services Limited P O Box 32081, Lusaka 260 211 252185 260 211 252185
from the Bank ever y
success in their future
endeavours.
D. DEVELOPMENT BANKS
1 Development Bank of Zambia P O Box 33955, Lusaka 0211-222821 0211-228576

E. SAVINGS AND CREDIT INSTITUTIONS

Obituary 1 National Savings and Credit Bank P O Box 30067, Lusaka 0211-227534 0211-223296

By Zambanker reporter worked in various with the Bank as a Security F. OTHER FINANCIAL INSTITUTIONS
The Bank of Zambia has lost departments as a messenger Officer – Operations.
1 Credit Reference Bureau Africa Limited P O Box 31199, Lusaka 0211-224263 0211-224257
four members of staff in the and tea maker before his Mr Kamanga was born on G. LIST OF BUREAUX DE CHANGE
third quarter of 2010. Of demise. November 1 APT Bureau de Change Limited P O Box 34553, Lusaka 0211-225637 0211-221993
those who died, two were He was born in 1957. 30, 1975. 2 Atics Bureau de Change Limited P O Box 31407, Lusaka 0211-223443 0211-223443
from Security Division, one 3 A and I Bureau de Change Limited P O Box 35443, Lusaka 0211-224350 0211-224350
Mr Lewis Lupupa died on Mr Kamoza 4 Becky's Bureau de Change Limited P O Box 50727, Lusaka 0211-228217 0211-228394
from Procurement and August 21, 2010 at the Zimba died 5 Bimm Bureau de Change Limited P O Box 34656, Lusaka 0211-220647 0211-229149
Maintenance Services University Teaching Hospital o n 6 Bullion Bureau de Change Limited P O Box 33322, Lusaka 0211-235196 0211-235196
Department while the other after an illness. He joined the September
7 C & A Bureau de Change Limited P O Box 32007, Lusaka 0211-235543 0211-235543
8 Casha Bureau de Change Limited P O Box 32543, Lusaka 0211-232923 0211-223160
was from Internal Audit Bank on March 31, 2003 as a 18, 2010 9 CFB Bureau de Change Limited P O Box 38074, Lusaka 0211-226588 0211-231787
Department. Those who died Security Officer - Operations. following a 10 Challenge Bureau de Change Limited P O Box 36020, Lusaka 0211-229369 0211-229358
were Mr Francis Phiri, Mr On April 28, 2009, he was road traffic 11 Choice Bureau de Change Limited P O Box 50895, Lusaka 0211-220262 0211-220262
12 Chuvic Bureau de Change Limited P O Box 60660, L/stone 0213-327011 0213-322524
Lewis Lupupa, Mr Micheal appointed Senior Security accident. Mr 13 Citizen Bureau de Change Limited P O Box 34284, Lusaka 0211-221394 0211-230411
Kamanga and Mr Kamoza Officer - Operations, the Zimba joined 14 Dondou Bureau de Change Limited P O Box 23110, Kitwe 0212-232017 0212-232017
Zimba. position he held at the time of the Bank on 15 EL Thomas Bureau de Change Limited P O Box 31343, Lusaka 0211-222879 0211-222879
Mr Francis Phiri died on July his demise. May 5, 2008 Mr Kamanga 16 Elite Bureau de Change Limited P O Box 60987, Livingstone 0213-322660 0213-322660
17 Flex Bureau de Change Limited P O Box 37804, Lusaka 0211-225316 0211-231344
19, 2010 at the University B e f o r e as an Internal 18 FS Bureau de Change Limited P O Box 34882, Lusaka 0211-222064 0211-223879
Te a c h i n g joining the Auditor in the 19 Forex King Bureau de Change Limited P O Box 36175, Lusaka 0211-236730 0211-236730
Hospital after Bank, he had Internal 20 FX Africa Bureau de Change Limited P O Box 51086 RW, Lusaka 0211-232363 0211-232276
21 Golden Coin Bureau de Change Limited P O Box 36552, Lusaka 0211-235850 0211-235851
an illness. Mr worked for A u d i t 22 Goldfield Bureau de Change Limited P O Box 32253, Lusaka 0211-233847 0211-233847
Phiri joined Zambia Police department. 23 M & T Bureau de Change Limited P O Box 31249, Lusaka 0211-251438 0211-251438
the Bank on as a Police B e f o r e 24 Mill Bureau de Change Limited P O Box 34647, Lusaka 0211-235974 0211-235974
October 1, officer based joining the
25 NyamiNyami Bureau de Change Ltd P O Box 60936, L/stone 0213-322489 0213-322489
26 Northmead Bureau de Change Limited P O Box 36648, Lusaka 0211-290426 0211-290426
1980 as a at State Bank, he had 27 Roseco Bureau de Change Limited P O Box 39044, Lusaka 0977-108060
g e n e r a l House. worked for 28 Runnymede Bureau de Change Limited Private Bag 383X, Lusaka 0211-261978 0211-261958
worker in the Mr Lupupa National 29 Saints Bureau de Change Limited P O Box 51428, Lusaka 0211-227939 0211-227939
30 Sterling Bureau de Change Limited P O Box 70658, Ndola 0212-620825 0212-621415
Estates and was born in Pe n s i o n 31 Stero Bureau de Change Limited P O Box 33604, Lusaka 0211-222736 0211-222736
Properties 1973. S c h e m e 32 Struts Bureau de Change Limited P O Box 36341, Lusaka 0211-256378 0211-268320
Department Mr Micheal Authority 33 Swift Bureau de Change Limited P O Box 32882, Lusaka 0211-223012 0211-222788
Mr Lupupa Mr Zimba 34 Unifinance Bureau de Change Limited P O Box 35495, Lusaka 0211-237575 0211-227342
n o w Mr Phiri Kamanga (NAPSA) as 35 Variety Bureau de Change Limited P O Box 32152, Lusaka 0211-235445 0211-233481
Procurement and died on September 6, 2010 an Assistant Internal 36 Walk Tall Bureau de Change Limited P O Box 73819, Ndola 0212-621929
Maintenance Services after an illness, less than two Auditor. He had also worked 37 Zampost Bureau de Change Limited P O Box 30003, Lusaka 0211-220563 0211-220567
Department. months after joining the for Ernst & Young as a Pre- 38 Zanwiche Bureau de Change Limited P O Box 31129, Lusaka 0211-233282 0211-233282
39 Gobena Bureau de Change Limited P O Box 34247, Lusaka 0211-287262 0211-287262
In 1991, Mr Phiri was Bank on secondment. Mr Senior Auditor. 40 RADOX Bureau de Change Limited P O Box FW 467, Lusaka 0211-227864 0211-227864
appointed as Office Orderly Kamanga was seconded to Mr Zimba was born on 41 Crusade Bureau de Change Limited P O Box 31879, Lusaka 0211 264601 0211-264601
under the General Services the Bank from Zambia Police February 14, 1975. 42 Dilt Bureau de Change Limited P O Box 36413, Lusaka 0211-228749 0211-228749
department. Mr Phiri had 43 Presans Bureau de Change Limited P O Box 38723, Lusaka
on July 28, 2010. He was May their souls rest in peace. 44 Floodgates Forex Bureau de Change Limited P O Box 34559, Lusaka 0211-234658 0211-234658

A BANK OF ZAMBIA JOURNAL 14 ZAMBANKER SEPTEMBER 2010

 FEATURE

Regional office visits Kansanshi mine actual construction only road in Chingola was not
began in 2003 and was enough, the second night in
completed in 2005. Solwezi brought with it some
Kansanshi produced its first exciting revelations.
copper cathode on 23rd March The team had to endure a
2005. rather long wait for a meal in a
From that time production has local restaurant, after having
steadily increased and more taken the bold decision that
than USD 600 million has they would not leave the
been invested in the mining North West without sampling
operations by First Quantum the local cuisine.
Minerals since inception. Assistant Manager Banking -
The Mine currently employs Front Office, Mukuka Puta
about 4,000 people across the who was also part of the
Mine site. group, described the visit to
It has also created a lot of the caves as because it was as
business opportunities for good as seeing God's hand at
business houses in Solwezi work.
who either supply or service He said the view points are at
contracts with the Mine. different height levels, and so
The Manager's circle, entirely managing the whole walk
financed by individual around proved too strenuous
contributions from members for some of the staff members.
of staff on a monthly standard “The literature and pictures
token to an account in depicting other recognized
banking office, has through sites in the country proved
the years done exceptionally very educative and the staff
well in trying to encourage managing the site was found
and maintain the visit Zambia to be highly informed and
campaign which was helpful to the team,” Mr Puta
Some members of the Regional Office Managers’ Circle seem to be “marooned” aboard the “mariner” at Mutanda Falls in Solwezi. They, launched sometime back. said.
however, don’t appear to be looking for any help at all! The tours, which are taken He said it was always a
once every so often, are in challenge to organise a group
By Zambanker reporter excursions to Mfuwe National borders with Angola and the government. as diverse as a team of
recognition of the fact that
The Regional Office Park, visits to Chaminuka and Democratic Republic of The Mine which is probably Managers, because once in a
within the confines of the
Manager's Circle recently took the world famed Victoria Falls Congo. one of the oldest in Zambia while someone puts their
offices, people are not able to
an excursion to North- in Livingstone, to mention but Kansanshi Mine produces and dates back to the 4th adequately reach out to each interest before the collective
Western Province to tour what a few. about 40% of the total copper Century over 1, 600 years interest of the group.
other as individuals to a level
is currently one of Zambia's This year the team was exported from Zambia. In ago. In 1899 the mine was He, however, said dealing
where they can know one
largest copper producing treated to a magnificent tour that respect, Kansanshi is rediscovered by Mr. George with these types of people
another sufficiently to
mines, Kansanshi. of the Kansanshi Copper Mine helping the country to earn Grey, who hailed from added to the fun as long as it
understand the other's
The Manager's Circle has in in Solwezi, found in the the much-needed foreign Scotland. remained within reasonable
strengths and weaknesses.
the past few years taken North-Western Province of exchange and is also First Quantum Minerals, a limits, and adding that
The tour to the North West
excursions to the famous Zambia, which happens to be contributing to economic Canadian Company bought attempts had been made in
comprised of twenty-two
Chimfushi orphanage in the second largest province development through the the business from Phelps the past to rotate the
members, including Regional
Chingola, four separate after Northern Province and payment of taxes to the Dodge in the year 2001, but organizers, but there were not
Director Morris Mulomba,
who also took some time off to too many volunteers and at
visit the Mine. times the ones that
CROSSWORD PUZZLE 26 The tour was deemed exciting
and fulfilling in that it
volunteered were not able to
negotiate accommodation
ACROSS spanned over education and rates.
1 2 3 4 5 6 leisure, and offered them the After viewing the caves, the
7. Computers (6) opportunity to visit one of team had a sumptuous lunch
8. Trustworthy (4, 4) Zambia's oldest mines. at Chabanga Lodge Solwezi,
9. Repairs (6) As the trip was reaching some after which they started off on
levels of crescendo, the team the 30km journey to Mutanda
12. Penniless (5) woke up to a rather rude Waterfalls.
7 shock after some of the team To add to the exciting
13. Adjust (5)
members found themselves moments of their visit, the
14. Present (5)
wading in pools of water as team held a cocktail at the
16. Consider (5) 8 their rooms were flooded due Chabanga Lodge swimming
19. Delight (6) to leaking pipes at a pool area, although it was
prominent Hotel in Chingola, reported that their guests only
20. Connectable (8) 9 10 11 started arriving for the
where they spent their first
21. Continent (6) night on the road. function after 20:00 hours.
23. Deadlock (9) Upon reaching their The team started their journey
12 back to Ndola the following
destination, the site visit
started off in the boardroom day only to develop a
DOWN with an overview of the Mine, mechanical fault, forcing the
13 14 15 conducted by Kansanshi team to stop at least every
1. River (7)
Mines Plc Manager in Charge three kilometers to manually
2. Volume (9) of Public Relations, Godfrey assist the fuel pump, resulting
16 17 18
3. Apprentice (6) Msiska. in the journey taking longer
4. Transcend (6) The team then embarked on a than expected.
tour of the whole mine works, After arrival in Chingola, the
5. Uproar (3) 19 team had to leave the BoZ bus
ranging from the pit which is
6. Charges (5) cited as a vintage point, to the at Chingola Police Station and
20 crusher plants and the copper transfer onto a chartered bus,
10. Fable (4)
cathode plant. which brought them back
11. Sugar Estate (9) The Kifubwa River caves, home to Ndola.
12. Tidings (4) recognized as a heritage site Though the team experienced
21 22
and now adopted by the Bank some problems on the way,
15. Designation, they still look forward to the
of Zambia was their next stop.
Period (4, 3) While there, the group learnt next outing which points
17. Fish, Insect (3, 3) more on the history of the towards a nearby intensive
caves and its surrounding dairy, beef, poultry, and
18. Gracious (6) areas. vegetable farm and managed
23
19. Ideas (5) As if their first night on the by expatriate missionaries.
22. Knock (3)
Views expressed in this publication are not necessarily
those of the Bank of Zambia Management or the Editor
Head Office Regional Office
Accross Bank of Zambia, Bank of Zambia,
7. Counts 8. Bona fide 9. Amends 12. Needy 13. Inure 14. Token 16. Weigh 19. Please Bank Square, Cairo Road Buteko Avenue,
P. O. Box 30080 P. O. Box 71511
20. Linkable 21. Africa 23. Stalement Lusaka 10101, Zambia Ndola, Zambia
Tel: + 260 1 228888/228903-20, Tel: +260 2 611633-52,
DOWN Fax: + 260 1 221764/237070 Fax: + 260 2 614251
Telex: Za41560, E-mail:pr@boz.zm, Telex: Za30100, E-mail:pr@boz.zm,
1. Zambezi 2. Magnitude 3. Novice 4. Exceed 5. Din 6. Costs 10. Myth Website: www.boz.zm Website: www.boz.zm
11. Nakambala 12. News 15. Name, Age 17. Eel, Ant 18. Genial 19. Plans 22. Rap Produced and Published by the Public Relations Division,
Bank of Zambia

A BANK OF ZAMBIA JOURNAL 15 ZAMBANKER SEPTEMBER 2010

16 A BANK OF ZAMBIA JOURNAL SPORTS NEWS SEPTEMBER 2010

BoZ Madalas discover

a winning formula
By Zambanker reporter score sheet in the 13th minute fulltime, Nimon Muleya was
Jacob Lungu scored a brace, when he connected a superb introduced for Kelvin Seta,
while Willard Chuulu, James cross from overlapping who limped out of the game
Chonya and Mickey Phiri had defender Lazarous Siluonde with a hamstring injury.
their names added onto the who was on the left flank. The madalas were further
score sheet with a goal each, BoZ commanded the midfield awarded a penalty after the
after the Bank of Zambia (BoZ) marshaled by Morgan Kamwala High School team
madalas football team Kalunga and Joseph Tembo goalkeeper committed a foul
thrashed Kamwala High and the exchange of passes in in his 18 yard when he brought
School members of staff the area made them create a down Willard Chuulu barely
football team in a friendly chance for Willard Chuulu, five minutes to fulltime.
match played at the BoZ who did not miss the Mickey Phiri converted the
Recreation Club. opportunity to put the spot kick after sending the
The game ended at 5 – 1 in Bankers two up. g o a l ke e p e r i n a w r o n g
favour of BoZ. Lungu scored his second goal direction.
With this result, the BoZ team in the first half, giving the Defender James Chonya put
recorded three games madalas a 3 – 0 lead at half the icing on the cake when he
unbeaten consecutively, after time, courtesy of a pass by scored during added time
a 1-7 win against Rhodes Park defender, James Chonya. making it his first goal this
employees played at Rhodes After the break, the teachers season.
Park School and a 7-0 white- looked a bit more organized The next game on the cards is
wash against MTN played at and managed to get a between madalas and the law
the BoZ Social Club. consolation goal through their enforcers – Road Transport
Members of the BoZ Madalas team caught strategizing at half-time during their match against Kamwala High School Top scorer Jacob Lungu had top man. and Safety Agency (RTSA).
Teachers at the Lusaka BoZ Social Club. Kamwala humbly lost 5-1. his name added first on the With 15 minutes before

Madalas emerge victorious over Book World

Counterfeit Banknotes
The Bank of Zambia wishes to
alert members of the public the
need to take precautionary
measures, especially when
dealing with high value Zambian
Kwacha and foreign currency
notes as these are the most
frequently targeted by
counterfeiters.
If you suspect a banknote to be
counterfeit, please compare it
with a genuine banknote. Avoid
dealing with banknotes in dark
places or in areas where there is
poor lighting. Never be in a hurry
when dealing with the banknotes,
particularly, when dealing with
bulk cash. Always ensure that the
banknotes face the same side
and are of the same size and
denomination before you start
counting your banknotes.
Remember that you do not need
special machines to detect a
counterfeit banknote. Usually,
the following simple checks will
suffice:
Feel the quality of the paper and
intaglio print: the security paper
and special printing process give
genuine banknotes a unique feel.
If the note is in reasonable
condition, it should be crisp, not
limp or waxy.
By Zambanker reporter
Book World kicked off in high gear
scoring their first goal in under a
Check the quality of printing: the lines minute after the first whistle. The
Bank of Zambia goal minder Mr.
should be sharp, well defined and
Severiano Tembo could not live up to
colours should be both clear and
his old reputation of “Seve save us” as
distinct; and Book World flipped pages in quick
Check the Security thread: genuine succession towards the BoZ goal
banknotes have an embedded mouth. Seve's old legs could not
thread that appears as a bold generate sufficient torque to lift off and
continuous thread when held dive as the Book World striker placed
against light and has a series of the ball into the far post, well beyond
dashes under normal light Seve's reach.
conditions. In addition for K50, After cranking their aging engines for
000.00 and K20, 000.00 notes, the about 20 minutes, the BoZ team got
colour of the thread changes into the rythm, displaying fascinating
football, dominating the midfield with
depending on the viewing angle.
Goodson Kataya and Joseph Tembo
controlling affairs in the middle of the
Hologram: This appears as a silvery park.
or gold colour patch in form of a Book World succumbed to immense
flying eagle, map of Zambia and pressure mounted by the fast
head of an eagle on a K50, 000.00, improving and bullish BoZ. In the 25
th
K20, 000.00 and K10, 000.00 note minute, a well calculated defence-
respectively. splitting pass from slick Willard
Chuulu to Jacob Lungu, who rounded
Always feel, tilt and look at your up two defenders and unleashed a
banknotes before transacting to power shot inside the 18 area left the
youthful Book World goal keeper
avoid being cheated.
Remember that it is a criminal
offence to possess or tender a
counterfeit note.
If in doubt or for further clarification,
please contact the Police or:
sprawled on the turf feeling the effects
of the whirl wind generated by the
shot. With scores at 1-1, Book World
turned a new chapter with clear intent
to restoring their lead. While BoZ was
still celebrating the equaliser, Book
World scored a superb volley forcing
the BoZ goal keeper to stretch beyond
human limit but could not still stop the
ball from going in.
BoZ, who had momentarily
slumbered, only to be awoken by Book
World's second goal pushed forward,
pinning their opponents in their own
half. The pressure paid dividends just
before half time, BoZ was awarded a
penalty after a Book World defender
handled the ball inside the 18 area.
The spot kick was executed by the no-
nonsense defensive midfield dynamo
Goodson Kataya.
At half time scores were level at 2-2. Jacob
On resumption, with old engines up Mickey and Kedrick. BoZ continued to
and running, the Bankers sterilised make in-roads, with the visitors
every move made by their opponents chasing shadows as BoZ madalas
and mopped up all their scoring interchanged neat passes. Man of the
chances. To reinvigorate the team, match, Slick Willard Chuulu scored a
BoZ made changes in the 60th minute brace, scoring the third and fourth
bringing in Abel “2 minutes” Shimba, goals. The match ended 4-3 in favour
Andrew Phiri and Tobias for Jacob, of BoZ madalas.

Look at the watermark: the

watermark should be barely
visible until the note is held
against light and a clearly defined
portrait of a Fish Eagle should be
visible from both sides of the note.

Scrutinise Serial numbers: all HEAD OF PUBLIC RELATIONS

banknotes have unique serial Bank of Zambia,
numbers that run vertically and P. O. Box 30080
horizontally. If you come across LUSAKA
two notes with the same number,
one or both of them may be Tel: 211 228888 Fax: 211
counterfeit. 221764
E-mail: pr@boz.zm
www.boz.zm BoZ netball team players Caron Hamafonko, Team Trainer Timothy Kalenga, Lubinda, Rebecca Njovu, Luckness
Msiska and Sheila Kasaro after a gruelling match against Kamwala High School Teachers at the BoZ Social Club

PRODUCED AND PUBLISHED BY THE BANK OF ZAMBIA, PUBLIC RELATIONS DIVISION, GRAPHICS: CHISAMBA EVANS,