RegAlertRule · BOZ
Application for Off-Tender Government Securities Transactions
The Bank of Zambia mandates that commercial banks and off-tender agents must eliminate artificial ceilings on government securities purchases to resolve investor complaints about uninvested funds. Financial institutions are required to allow clients to utilize their full account balances for bond or Treasury bill acquisitions, provided only minimum balance and operational requirements are satisfied. This directive applies to all off-tender transactions and explicitly permits the deduction of handling fees from the available account balance.
BANK OF ZAMBIA
OFFICE OF THE DEPUTY GOVERNOR - ADMINISTRATION
Tel. 228888/228903-20 P O Box 30080 Cairo Road Lusaka 10101
11 November 2002
CB Circular No. 18/2002
To: All Commercial Banks and Off-Tender Agents
Dear Sirs/Madams
APPLICATIONS FOR OFF-TENDER GOVERNMENT SECURITIES TRANSACTIONS
The Bank of Zambia has received numerous complaints from clients regarding the manner commercial banks and Off-Tender Agents are handling their off-tender government securities applications. Investors have complained that some commercial banks/Off-Tender Agents do not allow their customers/clients to exhaust balances in their respective accounts when applying to purchase government securities in instances where the face value of the bonds or Treasury bills to be purchased exceeds the balance in the account. As a result, a substantial portion of investors’ funds remains uninvested.
The Bank of Zambia wishes to urge commercial banks and Off-tender Agents to facilitate investors investments by desisting from placing ceilings on the face value but to simply ensure that the balance in the customers’ account is sufficient to cover the cost of the purchase including the handling fees as long as the minimum account balance and other operational account requirements are met.
Yours faithfully
Chilufya Mbalashi (Ms)
DEPUTY GOVERNOR - ADMINISTRATION
Bank Square Cairo Road P.O. Box 30080, Lusaka, Zambia Tel: +260-1-229930 Fax: +260-1-222808 Email: cmbalashi@boz.zm web http://www.boz.zm
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Source: Bank of Zambia — original document · Summary generated with machine assistance and reviewed before publication; the authoritative text is the regulator's original document. How RegAlert works
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