ZIMBABWE – The Agriculture Bank of Zimbabwe Limited (Agribank) and the Infrastructure Development Bank of Zimbabwe (IDBZ) have now been fully removed from the US sanctions list, allowing them to do international business more easily and obtain lines of credit.
The two banks were put under US sanctions in July 2008. In April 2013 sanctions were partially lifted by the issuance of a licence permitting business with the two banks subject to limitations, reports the Herald.
In February 2016 they were removed from the sanctions list, but the licence requirements remained. These have now been removed by the Office of Foreign Assets Control of the US Treasury.
Finance and Economic Development Minister Professor Mthuli Ncube stated, “This will help the bank access credit lines and remove any restrictions that pertain to Know-Your-Customer challenges, which is really what happens when a bank is in the spotlight. Now that the sanctions have been lifted, the banks will find it easier to do business going forward. So this is a very welcome development indeed.”
In particular, by being taken off all sanctions lists, many of those who were reluctant about doing business with Agribank and IDBZ will now feel it is safe to deal with them.
Under general international rules, other banks and businesses were reluctant to have any dealings, even permitted dealings, with the two because they were worried about falling foul of the Know-Your-Customer rules.
Pan African Chamber of Commerce board member Mr Langton Mabhanga said said Agribank can now fully enjoy its legal persona as an agricultural bank.
“The bank can now access lines of credit with international monetary institutions especially the agriculture-specific facilities. This will also enable the bank to directly move money to and from the markets, hence cutting the premium charged on its transactions.
“Agribank can now access any market. All these put together, the farmer is the winner. We urge the US to walk much faster in this very direction of undoing the sanctions,” he added.
In the recently released financials for Agribank for the year ended December 2019, the agricultural lender, recorded a historic jump in profit of 155% from $13million recorded in the previous year to $33 million, despite the challenging economic environment.
The profit increase was mainly driven by growth in non-interest income as well as interest income, against the background of increased transactions from the ICT delivery channels and electronic banking (e-channels) and a marked growth in the loan book.