charles s r chuka : financial and economic challenges for malawi address by mr charles s r chuka, governor of the reserve bank of malawi, at the bankers association dinner and dance, blantyre, 8 september 2012. * * * the president, bankers association of malawi, mr. william chatsala and your executive committee chief executive and management of banks and other financial institutions the vice chancellor, dr emmanuel fabiano the principal of polytechnic, dr grant kululanga the ceo, bankers association of malawi, mrs. nkungula, distinguished guests ladies and gentlemen i am very delighted to be part of this colourful occasion. and so i want to thank you, mr president, for the invitation to partake in the dinner that is soon to be served. it is the dining and wining part that i came for but i can also well appreciate why you would want me to say something, albeit short. i therefore intend to be very brief in my remarks. mr president, ladies and gentlemen let me start by applauding bam executive management for being foresighted in fostering discussions and debate on issues that affect the banking industry and thus the entire economy. it is through occasions like this one that the financial and banking experts in this country can make enormous contribution to the policy making process. i can assure you that we – the reserve bank of malawi team – do carefully listen to sentiments expressed in our consultations as well as the media. i must admit there are public sentiments that we prefer to ignore. allow me to give you some examples. first, on august 14 the nation carried a story “ banks borrow k0. 8 trillion from rbm ”. that was for the month of july, meaning the rbm went away with k1. 4 billion in interest. obviously, the so called banking liquidity crisis was going to get worse with borrowing from the discount window. well, the truth of the matter is that the k25. 9 billion daily average was a rolling figure and not to be treated as separate borrowings. today it was the turn of daily times which carried the title “ scrap off floating exchange regime ”, the argument being it makes planning difficult. well, i hope that ibam members made more money when the kwacha was fixed. my sense is that planning meant nothing then in the absence of hard currency in the banks. i think that ibam members stand a greater chance than hitherto to make more money. at the same time, however

to note that for the rbm to function effectively there are a number of departments that carry out several functions aimed at meeting the institutional objectives. the following are the departments ; research and statistics, treasury, exchange control and debt management, banking and payment systems, bank supervision, supervision of non - bank financial services, currency management, legal affairs, administration, information, communication and technology, accounting and finance, internal audit, risk management, human resource and institutional development, protective services and public relations. there will be brief presentations from some of the departments where most of what i have said will be clarified further. in addition, you will go around some of these departments to see what goes on there. i hope that we can have an exciting exchange of ideas after going through these departments. once again, we are pleased to have you here and please do take the opportunity to learn about this unique institution. lastly, let me take this opportunity to invite you back to this room where your burning questions should be asked and possible responses given. thank you for your attention. may god bless you all.