Regulatory Alerts2002-01-01
Bank of Zambia Circular 04/2002: Conversion of Commercial Banks' Foreign Currency Statutory Reserve Balances from Kwacha to Foreign Currency
The Bank of Zambia mandates the full conversion of commercial banks' foreign currency statutory reserve balances from kwacha to US dollars to reduce credit costs for the agriculture sector. This transition will occur in four equal tranches beginning April 8, 2002, requiring banks to maintain separate kwacha and foreign currency reserve accounts until full compliance is achieved by January 2003. All reserve transactions must be settled via telegraphic transfer in US dollars to a designated CitiBank account, with shortfall penalties calculated at the prevailing Bank of Zambia mid-exchange rate.
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