‘Banks to be cautious in advancing loans’

Banking sector deposits are expected to grow by less than 2% this year attributed to waning disposable income and constrained economic growth, a leading brokerage firm has said, urging banks to tap into the informal sector.

In a report titled Zimbabwe Banking Sector Analysis FY2014, MMC Capital said deposits were projected to reach $5,2 billion from $5,1 billion recorded in 2014.

“We maintain our view that the following factors will continue to restrain deposit growth: economic growth remains constrained by challenges stemming from the large external debt burden and high unemployment (estimated at over 80%) and waning disposable income will also continue to have a negative impact on deposit growth,” MMC said.

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