Relief for depositors of five closed banks

Tuesday March 20 2018


By Mnaku Mbani @mnaku28

Dar es Salaam. Disbursement of insured deposits for five liquidated community banks will commence at the end of this month, the Depository Insurance Board (DIB) has announced.

A DIB statement released yesterday said that the payments of depositors with Njombe Community Bank, Meru Community Bank, Kagera Farmers’ Cooperative Bank, Covenant Bank for Women and Efata Bank will start on March 28.

In January, the Bank of Tanzania (BoT) revoked licences of the five aforementioned banks and placed them under receivership. The BoT said the lenders breached core capital rules.

According to the latest DIB statement, reimbursement of the insured deposits to depositors will be made at former offices of the five banks. Payments will be done during business hours, from 9.00 am to 4.30 pm on weekdays and from 9.00 am to 12.30 pm on Saturdays, according to a public notice published on the BoT website.

The reimbursable amount shall be in accordance with the limit provided under the Banking and Financial Institutions Act 2006, which is up to Sh1.5 million per depositor.

However, the board has noted that payment of depositors’ claims exceeding Sh1.5 million will be dealt with after collecting liquidation proceeds in accordance with the Banking and Financial Institutions Act, 2006.

Required documentation for disbursement include filled claim form and proper identifications of the depositor including the national ID or Passport and for Tanzania nationals, voter registration ID, driver’s license or introduction letter from local government.

The DIB has also called for all debtors of the liquidated banks and all persons holding in their possession any asset or properties of the banks including, but not limited to official records and office equipment, to pay their debts to the liquidator not later than April 17, 2018.

“Those who do not surrender to the liquidator the assets or properties held by them as required will be holding them unlawfully with effect from April 17, 2018,” says the DIB statement.

The announcement of revocation of the banks was made by former governor Prof Benno Ndulu. He said the they decided to revoke their business licenses and took possession of five banks for being undercapitalized and violating the Banking and Financial institutions Act of 2006.