Bank deposits up 26pct y-o-y

Bank deposits up 26pct y-o-y

HARARE, October 27 (The Source) – Zimbabwe’s bank deposits increased 26 percent to $4,24 billion in August 2015 compared to $3,37 billion recorded in the same period last year as confidence slowly creeps back into the banking sector, latest figures from the central bank shows.

In its monthly economic review released this week, the Reserve Bank of Zimbabwe said the deposits in August were mainly dominated by services, which contributed $1,042 billion, while financial organisations chipped in with $784 million and individuals deposited $647 million.

In the month under review; distribution, manufacturing and finance and investment deposits stood at $473 million, $401 million and $335 million respectively. The remaining $558 million deposits came from agriculture, construction, mining, communication, transport and conglomerates.

However, according to the central bank, annual broad money supply growth rate decelerated from 5,9 percent in July 2015, to 3,5 percent in August 2015. Monthly broad money supply growth also declined from $4, 474 billion in July to  $4, 473 billion in August 2015.

“Annual growth in broad money was driven by increases across all deposit classes, with the exception of short term deposits. Long term deposits registered the largest annual growth of 17,6 percent, while savings and demand deposits, recorded increases of 3,3 percent and 5,4 percent, respectively. Short term deposits, however, declined by 16,9 percent,” read part of the report.

Annual growth in total banking sector credit to the domestic economy rose to 18,8 percent in August 2015, from 18,5 percent in July 2015, while on a monthly basis, banking sector credit rose by one percent to $5 029,1 million in August 2015, from $4 981,5 million in July 2015.

“On an annual basis, growth in credit to the private sector which makes up the largest proportion of banking sector credit slowed down to 1,4 percent in August 2015, from 1,9 percent in July 2015,” the report added.

The central bank noted that on a month-on-month basis, credit to the private sector decelerated from $3,77 billion in July, to $3, 78 billion in August 2015.

In terms of composition, loans and advances constituted 83,3 percent of the total credit to the private sector, mortgages advanced by building societies, 12,8 percent, other investments, 2,4 percent, bankers’ acceptances, 0,3 percent and bills discounted, 1,3 percent, in August.