RBM records K187 billion loss

Wilson Banda is the governor of the Reserve Bank of Malawi which is the central bank in Malawi

During the year that ended on 31 December 2022, Reserve Bank of Malawi made a comprehensive loss of K187.5 billion.

This is according to consolidated and separate annual financial statements posted on the bank’s website which addresses the performance and financial of the bank and its subsidiary Export Development Fund.

The statement shows RBM made a loss of K187.5 billion. In 2021, the bank made a profit of K77 billion.

According to the statement signed by RBM Governor Wilson Banda and Board Audit Committee chairperson Maxwell Mkwezalamba, the bank also reported profit before foreign exchange revaluation of K93 billion in 2022.

“K20 billion was declared as dividend and distributed to the government in the year ended 31 December 2022 while K31 billion was transferred to general reserve account,” reads part of the statement.

It also indicates that in the year under review, RBM had foreign liabilities of K1.76 trillion against assets of K439.5 billion.

The statements further show that the bank injected K10 billion into Export Development Fund in December 2022.

RBM Governor Banda told the local media that the bank posted an operating profit of K93 billion.

“The re-evaluation of our forex liabilities following the 25 percent devaluation explains this,” said Banda.

Experts say when the Central Bank makes losses it means the bank cannot sustain itself and the government could be forced to bail it out.

In May last year, the Central Bank with advice from President Lazarus Chakwera’s administration implemented a 25 percent devaluation of the Malawi Kwacha to resolve the problem of forex shortage.

However, Malawi is still facing a forex crisis and the devaluation only pushed up prices of various good and services.

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