Part IV of the Banking Act 1995 (Cap 46.04), covering 'Financial Statements, Audit and Supervision', establishes the framework through which banks in Botswana are supervised by the central bank. This is to ensure that the banks are managed responsibly, in a manner that maintains public confidence and supports financial stability.
The principal components of this supervisory framework include:
- Banks must keep proper financial records sufficient to explain their financial position in a manner that demonstrates that they have complied with the provisions of the Act.
- Annual accounts must be produced with in three months of the end of the financial year.
- Monthly statements of assets and liabilities must be provided to the central bank. In 2010, a more detailed reporting format for these statutory returns was agreed with the banks and this was introduced in January 2011.
- The Bank of Botswana may impose additional duties on banks' auditors to obtain additional information that it may consider necessary; auditors are required to disclose to the central bank any breach of the Banking Act or other relevant legislation.
- At least once a year, the Bank of Botswana arranges trilateral meetings with each bank and its auditors to review the financial performance.
- The Bank of Botswana conducts regular on-site examinations of all banks under its supervision (including, if necessary, any foreign branches). Special examinations can be undertaken if application is made by at least one fifth of a bank's depositors, or by depositors holding not less than one third of the bank's liabilities to the public in Botswana.
- If an examination reveals that a bank is operating in an unlawful or unsound manner, the Bank of Botswana can require the affected bank to take necessary steps to address the situation. If necessary, the central bank my appoint persons with the necessary experience to rectify the situation.
- Each year the Bank of Botswana prepares Banking Supervision Annual Report for submission to the Minister of Finance and Development Planning.
For more information, contact:
Banking Supervision Department
Tel: (267) 3606354
Fax: (267) 3913862
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