Good morning. Here’s what you need to know to start your day.
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The Bank of Zambia has taken possession of the Development Bank of Zambia due to non-complaince
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Over 40 nations express interest in joining BRICS
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Offshore Appetite for Kwacha Bonds Surges in Bullish Outlook
Story of the Day
In today’s fast-paced digital age, the use of technology is rapidly transforming the way the financial services sector is operating, and the management and delivery of pensions is no exception. Globally, technology has become an essential tool for businesses across various sectors to improve efficiency and as such, Octagon Financial Services Limited (Octagon) has continued to invest in technology with the aim of revolutionizing pension administration, thereby bringing convenience and reliability to its clients. With the rollout of its online pension platform – Octagon Pension Administration System (OPAS), Octagon has also positioned itself as a leader in leveraging technology to enhance the management of pension schemes in Zambia. Read more
In Local Business News Sponsored by
The Bank of Zambia has taken possession of the Development Bank of Zambia –DBZ- a non –deposit taking financial institution, with effect from July 21st 2023. This is due to the non-compliance of the Banking and Financial Services regulations. BOZ Assistant Director of Communications, Besnart Mwanza has confirmed this in a Statement to ZNBC News in Lusaka. Ms. Mwanza said the Central Bank has determined that DBZ is undercapitalized. She said despite consistent engagement by the Bank of Zambia, the Shareholders and Board of Directors of DBZ have been unable to resolve the regulatory capital deficiency of the institution. Ms Mwanza said the Central Bank has exercised its authority under the law to safeguard the interest of the public and protect the integrity of the financial system. Read more: ZNBC
An additional US$6 million has been offloaded on the market by the Bank of Zambia (BoZ) to partially meet high demand being experienced in the foreign exchange market. This was an in addition to the US$5 million which was offloaded on Monday this week by the Central Bank. The funds were said to have partially met the growing demand for hard currency, while usual liquidity providers held on to their United States (U.S) dollar position in hopes for higher rates. According to the market update by Access Bank Zambia, market activity on Thursday declined as a result of weaker dollar trading and the persistent dry spell for the greenback. Read more: Zambia Monitor
The central bank in Africa’s second largest copper producer Zambia successfully raised K4.09 billion ($204 million equivalent) proceeds in the seventh and strongest Kwacha bond sale of the year. Of an array of K2.6 billion worth of fixed income assets on offer, bids totaled K7.60 billion, levels unseen this year as offshore demand surged in search for yield. This was in view of the red metal producers economic outlook. This outcome marks the second oversubscription of the year. Read more: The Business Telegraph
Works on the US$294.2 million United States Dollar Kariba Dam Rehabilitation Project (KDRP) are progressing well with works being at 67 percent complete. Zambezi River Authority Chief Executive Officer (CEO) Munyaradzi Munodawafa said in a press statement to ZANIS that the project, which comprises three components, the Reshaping of the Plunge Pool, Refurbishment of the Spillway upstream control facility and institutional strengthening, is projected to be completed by the first quarter of 2025. Mr Munodawafa said KDRP will help to address dam safety concerns and restore the structural strength of the Kariba Dam for its long-term reliability and safety of operation. He said since construction, the Kariba Dam has served Zambia and Zimbabwe for over 60 years. Read more: Lusaka Times
Acting Finance Minister Felix Mutati says government has a budget of K500 million to recaptalise the National Savings and Credit Bank (NATSAVE) in the fourth quarter of 2023 to 2024. Mutati was responding to a question asked by Sikongo UPND member of parliament Mayungo Simushi in the National Assembly, Wednesday, on whether government had plans to recaptalise the bank. In response, Mutati said government had developed a turnaround strategy to ensure that NATSAVE operated profitably. Read more: News Diggers
Bank of Zambia Exchange Rates
Currency | Buying | Selling |
---|---|---|
USD | 19.3791 | 19.4258 |
GBP | 24.8673 | 24.9292 |
EUR | 21.5632 | 21.6229 |
ZAR | 1.0795 | 1.0824 |
In International Business News
Around twenty countries from around the world have applied to join the BRICS group, which currently consists of five nations, and an equal number of other countries have expressed an interest, South Africa, which is hosting its next summit, said on Thursday. The BRICS group (South Africa, Brazil, China, India and Russia), which aims to carry more weight in international institutions hitherto dominated by the United States and Europe, said it was open to possible expansion. “Twenty-two countries have formally approached the Brics countries to become full members of the group, and there is the same number of countries that have informally enquired about becoming Brics members”, said South Africa’s ambassador-at-large for Asia and the BRICS, Anil Sooklal. He cited Iran, Argentina, Bangladesh and Saudi Arabia among the countries that have expressed an interest, formal or informal, in joining the BRICS. The growing interest in the Brics group is “nothing new”, but it underlines the “confidence” in the work that the Brics have “championed” since the group’s inception, he added at a press briefing in Johannesburg. Read more: Africa News
The International Monetary Fund (IMF) should in the coming days finalize the basis for a staff level agreement with Argentina over a review of the country’s $44 billion loan with the IMF, the Washington-based fund said on Sunday. “The teams of the Economy Ministry and Central Bank of Argentina and the IMF staff have finished the core aspects of the technical work of the next review,” the IMF said on Twitter. “The central objectives and parameters that will be the basis for a “staff level agreement” have been agreed, which is expected to be finalized in the next few days before moving towards the review of the Argentina program,” it added. Argentina faces maturities with the IMF worth some $3.4 billion between July 31 and Aug. 1, at a time when the central bank’s net reserves are about $6.5 billion in the red. Read more: Reuters
Russia’s central bank hiked its key interest rate by a greater-than-expected 100 basis points to 8.5% on Friday, raising the cost of borrowing as the weak rouble added to inflation pressure from a tight labour market and strong consumer demand. It was the first time the bank had raised rates in more than a year, having gradually reversed an emergency hike to 20% made in February last year after Russia sent its armed forces into Ukraine, which prompted the West to impose sanctions on Moscow. Its last cut, to 7.5%, was in September. Read more: Reuters
The Board of Directors of the African Development Bank has given the go-ahead for a $1 billion major exposure swap with the Asian Development Bank. On the bank’s website, a statement made this disclosure. The bank stated that the major goal of the transaction is to enable the release of more sovereign lending headroom while bolstering the capital adequacy measures of the African Development Bank. The African Development Bank has already signed two exposure exchange agreements; the first was with the Inter-American Development Bank and the International Bank for the reconstruction and development of the World Bank Group. Read more: Business Insider
According to the International Monetary Fund, a 10% increase in the dollar due to global financial market dynamics reduced economic production in emerging market nations across Africa, including Nigeria, by 1.9%. It was found that this drop lasted two and a half years. According to the IMF, the US dollar will reach a 20-year high in 2022, with significant repercussions for the global economy. In the same year, the upward capital flows from developing and emerging market countries to established ones returned. China and the commodity-exporting nations were primarily responsible for the net capital outflows from emerging markets and developing countries, which have helped to cover some sizable current account deficits in advanced economies. According to the IMF, a high dollar hampered trade and financial channels in developing market economies, particularly in Africa. Read more: Business Insider
The central bank in Africa’s second largest copper producer Zambia successfully raised K4.09 billion ($204 million equivalent) proceeds in the seventh and strongest Kwacha bond sale of the year. Of an array of K2.6 billion worth of fixed income assets on offer, bids totaled K7.60 billion, levels unseen this year as offshore demand surged in search for yield. This was in view of the red metal producers economic outlook. This outcome marks the second oversubscription of the year. Read more: The Business Telegraph
In 106 trades recorded on Friday 31,182 shares were transacted resulting in a turnover of K127,055.73. Trading activity was recorded in CEC Zambia, Standard Chartered Bank Limited Zambia Breweries, Zambeef, ZANACO and ZAFFICO as well as CEC Africa on the quoted tier. The LuSE All Share Index (LASI) closed at 8,229.51 points, 0.02% lower than its previous close at 8,230.89 points. The market closed on a capitalization of K76,753,219,226.08 including Shoprite Holdings and K41,970,533,786.08 excluding Shoprite Holdings.