as agriculture and smes. in striving to meet these demands, banks must always comply with the regulations as stipulated in the banking and financial services act to ensure the safety of customers ’ deposits. i am proud of the stability that has been exhibited by our economy. however, mr chairman, i am disappointed that the cost of borrowing has remained high in spite of the improvements in the fiscal management of our economy. as you know, the high cost of borrowing stifles the growth of the productive sector. i therefore appeal to all the banks operating in zambia to show more commitment to the growth and development of our country by : • opening more branches • providing more loans to increase the productivity of our economy, and • encouraging more zambians to open bank accounts through provision of easily accessible and affordable products and services all this, ladies and gentlemen, will greatly contribute to the emergence of a middle class in zambia, which will bring real economic development and lead to poverty reduction. i am pleased to observe standard chartered bank ’ s commitment to growth and reinvestment. you will all agree with me, however, that those who have more should do more. i therefore look forward to seeing more from standard chartered bank zambia limited, as it is one of the leading banks in this country. i thank you.

transformation – though this means that they are exposed to risks that require sound risk management and strong supervision. 3. we need public discourse on the role of banks in the transformation process and what is expected of supervision and regulation. 1 the economy is undergoing structural change which is impacting on the real economy and financial sector alike. german and european banks have emerged fairly unscathed from the episodes of stress in international markets in march 2023. bank profits have risen recently, and capital and liquidity ratios are stable. [ 2 ] since the global financial crisis, stricter regulation has been implemented and supervision enhanced ; in particular, we have a functioning single supervisory mechanism ( ssm ( single supervisory mechanism ) ) in the european union. in recent years, we have adjusted the focus of supervision in order to address risks even more effectively and to identify problem institutions at an earlier stage. [ 3 ] but banks have most certainly also benefited from the extensive fiscal and monetary policy measures of recent years, which have absorbed shocks. the sound situation therefore must not detract from the fact that vulnerabilities have built up in recent years. after many years of stable growth, low inflation and low interest rates, banks ’ risk provisioning had fallen sharply. credit risk was low. the economy has since been hit by severe shocks. inflation and interest rates have risen significantly, and uncertainty is high. interest rates have already gone up by more than we had assumed in past adverse scenarios. supervisors have therefore taken action to mitigate the impact of these vulnerabilities. interest rate risk is a key priority. around two - thirds of the institutions supervised by the bundesbank are required to meet additional capital requirements in order to counter higher interest rate risk. deposit rates currently still stand at an average of 0. 22 % [ 4 ] and have thus risen less sharply than central bank policy rates. if deposits were to be shifted out of low - interest sight deposits into higher - interest time deposits, this would reduce banks ’ interest margins. off - site supervisors urge the institutions they supervise to model interest rate risk conservatively, for example by assuming an average maturity of less than five years for deposits without a set interest rate fixation period. the results of the eu ( european union ) - wide stress test conducted by the european banking authority ( eba ( european banking authority ) ) and the ecb ( european central bank ) ’ s parallel ssm ( single supervisory mechanism ) - wide stress test will also provide further insights into