The Reserve Bank of Zimbabwe recorded a 320 percent profit increase to $74 million in 2012 up from a loss of $35 million in 2011, the Bank’s latest annual report has revealed.
Former RBZ Governor Gideon Gono, who left the bank in November 2013 when his contract expired, said the surplus was due to impairment reversals as government repayments of some loans in the bank’s books were credited to amounts due from government – which had been impaired in prior years.
John Mangundya took over as governor in May last year.
“The deficit before impairment reversal for 2012 was higher compared to 2011 due to the decrease in government support in 2012,” said Gono in the report.
In 2012 government availed $14.95 million to the central bank compared to $32 million in 2011.
“However, due to loan repayments and debt take over by government, the Bank recognised an impairment reversal of $112 million which resulted in a surplus for the year ending December 31, 2012,” he said.
According to the annual report, loans and advances to government and statutory bodies were at $1.35 billion before impairment by end of 2012 compared to $1.47 billion recorded in the prior year.
Gono, who was also the RBZ chairman, noted that in the period under review government took over statutory reserves amounting to $83 million and issued bonds to various financial institutions.
“Accordingly, this amount and other payments by government were credited to amounts due from government. As a result, the Bank realised an impairment reversal of $112 million due to these credits,” he said.- The Source