Five Tanzanian Banks Closed By Government
For the first time in history, the Bank of Tanzania (BoT) has closed five community banks due to undercapitalisation. Affected are the financial institutions Covenant Bank for Women (Tanzania) Limited, Efatha Bank Limited, Njombe Community Bank Limited, Kagera farmers Cooperatives Bank Limited and Meru Community Bank Limited. BoT said that the continuation of operations of the banks in their current capital position was “detrimental to the interests of depositors and poses a risk to the stability of the financial system.” In Tanzania there are about 40 commercial banks and a dozen community banks, which target savings from specific communities or sectors such as farming. Tanzania’s economy grew at an annual rate of 6.8% in the first half of 2017 from 7.7% in the same period in 2016.