Debt swap in Limbo
Written by MillenniumEditor2 on July 22, 2021
Uncertainty has characterized the civil servants debt swap initiative following the bankers association of Zambia advice to the public service workers with existing loans obtained from commercial banks and other financial institutions that existing terms and conditions under which the loans were contracted are still in force.
Yesterday, after a meeting with financial institutions, Government announced that the Treasury has released over K255 million funding to clear the third party obligation to commercial banks and micro-finance institutions.
But the Bankers association of Zambia Leonard Mwanza says all loans contracted under the Payroll Management and Establishment Control (PMEC) shall remain active until government gives guidance on the ongoing reconciliations and the debt buy-back mechanisms.
Meanwhile Financial Analyst Maambo Hamaundu says the banks are within their rights to deduct what is due to them unless variations have been made in the initial conditions attached.
Mr Hamaundu says if the debt swap has to be actualized, commercial banks need to agree to vary the conditions failure to which the contractual obligations remain the same.
Mr Hamaundu says if adequate engagements had been done, the BAZ would not be issuing such a statement.