By Sizwe Dlamini
The Governor of the Central Bank of Eswatini (CBE), Dr. Phil Mnisi says the Bank is currently reviewing applications from various institutions, both locally and internationally.
Speaking during a media briefing held last week at the Bank’s headquarters, Mnisi noted that discussions are underway with several banks interested in entering the local market.
“Although the identities of these banks remain confidential to protect ongoing negotiations, the Central Bank’s drive to expand the banking sector is crucial for adapting to the rapid technological advancements reshaping customer interactions with financial institutions. We are currently reviewing five applicants and considering three of them for licensing,” Mnisi stated.
He stated that some of the applicants are local organizations that seek to operate as commercial banks.
When asked if the country can absorb more players in the banking space, the Governor noted that the lack of specialized niche banks in the country is a drain on the economy.
He made an example of the local non-banking financial services sector which has E100 billion in total value of assets but does not have specialized investment banks, as a result majority of the funds are invested outside of the country.
“Without adequate capital markets, we often find ourselves investing large sums of money outside the country, thereby growing other economies instead of our own,” he explained.
The Governor emphasized that the successful establishment of new banks could significantly enhance financial services, increase competition, and promote economic growth within Eswatini.
“You don’t want to overbank the economy and cause financial instability. We as the Central Bank are not involved in a marketing drive for more banks, instead we are focused on growing the economy. More banks will bring in investments and contribute to the country’s economic development,” he stated.
Mnisi cited Mauritius as an example, noting that it is a small country with over 20 banks and reiterated that Eswatini requires a range of banking institutions.
“We are not just talking about commercial banks; we need niche banks and investment banks that can effectively mobilize local capital and their capital for investment within the kingdom,” he said.