Govt endorses RBZ's new rules for the capital structure of banks.

So the Zimbabwean government has endorsed the new bank capital thresholds introduced by the RBZ. What would have happened if the government had refused to endorse the new rules? This would have been unchartered territory because the "independence" of the central bank would have been threatened by such a move. So what begs the question for me is how much control over monetary policy does the RBZ have in Zimbabwe?

What is clear to me is that the monetary and regulatory policy-making and powers of the RBZ are unclear indeed. This lack of clarity in this regard and the lack of formality in decision-making adds to uncertainty in the monetary policy details. Everything is just adhoc.

The government position urges Dr. Gono to make sure that indigenous banks aren't adversely affected by the policy change. But what these guys in the banking sector need to understand is that they have to be serious and ethical in the way they do their business. I'm no such a fan of these new capital thresholds because I believe they alone aren't comprehensive enough in addressing the problems affecting the banking industry. I'm not agitating for a particular capital threshold but I think other policy tools and a reality check by the RBZ over its own competence should have been implemented.

The trial and error approach by policy-makers should end. A more intense debate should be norm on issues like this. The intense part encompases logical and sound reasoning not the quality of debate currently around.