CHAPTER 55:01
BANK OF BOTSWANA

 

ARRANGEMENT OF SECTIONS

 

   SECTION

 

 

 

PART I
Preliminary

 

   1.   Short title

 

   2.   Interpretation

 

 

 

PART II
Establishment, Constitution and Objectives

 

   3.   Establishment of central bank

 

   4.   Principal objectives of Bank

 

 

 

PART III
Capital, Profits and Reserves

 

   5.   Capital

 

   6.   Profits

 

   7.   General Reserve

 

 

 

PART IV
Board, Management and Staff

 

   8.   Establishment and powers of Board

 

   9.   Membership of Board

 

   10.   Other members of Board

 

   11.   Vacancy

 

   12.   Meetings and quorum of Board

 

   13.   Governor and Deputy Governors

 

   14.   Ineligibility

 

   15.   Disqualification and removal from office

 

   16.   Resignation

 

   17.   Appointment of officers, employees, agents and correspondents

 

   18.   Conflicts of interest

 

   19.   Secrecy

 

 

 

PART V
Monetary Unit, Notes and Coins

 

   20.   Monetary unit

 

   21.   Exchange rate

 

   22.   Sole right to issue notes and coins

 

   23.   Notes and coins to be legal tender

 

   24.   Manufacture and characteristics of notes and coins

 

   25.   Power to recall currency

 

   26.   Exchange of notes and coins

 

   27.   Penalty for mutilation of notes

 

   28.   Recovery of lost or stolen notes and coins

 

   29.   Counterfeiting, forgery, etc.

 

 

 

PART VI
International Reserve

 

   30.   Authority to transact foreign exchange business

 

   31.   Primary International Reserve

 

   32.   Adequacy of Primary International Reserve

 

   33.   Operations in foreign exchange

 

   34.   Limitations

 

   35.   Long term investment funds

 

 

 

PART VII
Relations with Financial Institutions

 

   36.   Opening accounts for domestic financial institutions, etc.

 

   37.   Opening accounts for other institutions, etc.

 

   38.   Operations with account holders

 

   39.   Determination of rates for discounts and advances

 

   40.   Primary reserve requirements

 

   41.   Regulation of interest and credit

 

   42.   Maximum amounts of foreign currency holdings or loans

 

   43.   Clearing facilities

 

 

 

PART VIII
Regulation of Companies which have Applied for or been Issued with a Tax Certificate

 

   44.   Interpretation

 

   45.   Application

 

   46.   Exemptions

 

   47.   Supervisory and inspection powers

 

   48.   Power to inspect

 

   49.   Recommendations of Bank

 

   50.   Disclosure of information

 

   51.   Levying of fees

 

   52.   Offences

 

   53.   Penalty

 

 

 

PART IX
Relations with Government

 

   54.   Banker, fiscal agent of and adviser to Government

 

   55.   Bank depository of Government funds

 

   56.   Management of Government securities

 

   57.   Agency functions

 

   58.   Banker and fiscal agent to Government boards and agencies

 

   59.   Borrowings by Government and public bodies, etc.

 

   60.   Advances to Government

 

   61.   Transactions in Government securities

 

   62.   Limitation on lending to Government

 

   63.   Agent for the administration of exchange control

 

   64.   Depository and fiscal agency for international financial organizations

 

   65.   Policy directives by President

 

 

 

PART X
Accounts, Financial Statements and Financial Year

 

   66.   Accounts, financial statements and financial year

 

   67.   Audit

 

   68.   Annual report and monthly return

 

 

 

PART XI
General

 

   69.   Prohibited activities

 

   70.   Bank may call for information

 

   71.   Exemption from Banking Act

 

   72.   Exemption from taxes, etc.

 

   73.   Regulations

 

   74.   Repeal and saving

 

 

Act 19, 1996,
Act 19, 1999,
Act 2, 2007.

An Act to provide for the establishment of the Bank of Botswana, its constitution, objectives and powers; to regulate the issue of Bank notes and coins; to provide for certain matters connected with banking, currency and coinage, and for matters connected therewith and incidental thereto.

[Date of Commencement:1st January, 1997]

PART I
Preliminary (ss 1-2)

 

1.   Short title

   This Act may be cited as the Bank of Botswana Act, 1996.

 

2.   Interpretation

   In this Act, unless the context otherwise requires-

   "Bank" means the Bank of Botswana established under section 3;

   "Board" means the Board of the Bank established under section 8;

   "Deputy Governor" means a deputy governor appointed under section 13;

   "financial institution", "bank" and "licensed" shall have the same meanings ascribed thereto under the Banking Act;

   "Governor" means the Governor of the Bank appointed under section 13;

   "legal tender" means currency which, legally, cannot be refused to settle debt or to effect payment at an agreed price;

   "member" means a member of the Board and includes the Governor;

   "officer" means an employee of the Bank who is authorized by the board to sign legal or other documents on behalf of the Bank;

   "public issue" means any financial instrument issued or guaranteed by Government, which members of the public are eligible to hold.

PART II
Establishment, Constitution and Objectives (ss 3-4)

 

3.   Establishment of central bank

   (1) There is hereby established a central bank, to be known as the Bank of Botswana, which shall be a body corporate with perpetual succession and a common seal, capable of suing and being sued in its corporate name and which, subject to the provisions of this Act, may hold and dispose of movable and immovable property and do all such other things as are necessary for or conducive to the proper carrying out of its objectives and the performance of its functions.

   (2) The Bank shall have its head office in Gaborone and may establish branches in Botswana and, with the approval of the Minister, abroad, and may appoint agents and correspondents in Botswana and abroad.

 

4.   Principal objectives of Bank

   (1) The principal objectives of the Bank shall be-

 

   (a)   first and foremost to promote and maintain monetary stability, an efficient payments mechanism and the liquidity, solvency and proper functioning of a soundly based monetary, credit and financial system in Botswana;

 

   (b)   secondly, in so far as it is not inconsistent with the objectives set out in paragraph (a), to foster monetary, credit and financial conditions conducive to the orderly, balanced and sustained economic development of Botswana; and

 

   (c)   thirdly, to assist insofar as it is not inconsistent with the objectives as set out in paragraphs (a) and (b), in the attainment of national economic development goals.

   (2) In the attainment of the objectives set out in subsection (1), the Bank shall have and may exercise all the powers generally conferred upon a central bank.

PART III
Capital, Profits and Reserves (ss 5-7)

 

5.   Capital

   (1) The authorized capital of the Bank shall be P25 000, 000.

   (2) Government shall be the sole subscriber to and holder of the capital of the Bank, and its holdings of such capital shall not be transferable in whole or in part or be subject to any encumbrance whatsoever.

   (3) Whenever the assets of the Bank are less than the sum of its liabilities and capital, the Minister, notwithstanding the provisions of any other written law, shall cause to be transferred to the ownership of the Bank non-negotiable non-interest bearing Government securities for such amount as is necessary for the purpose of preserving such capital from any impairment, which securities shall be a charge on the Consolidated Fund.

 

6.   Profits

   (1) At the end of each financial year of the Bank, the Bank shall transfer any net profits from its operations to the Government in accordance with a schedule to be agreed between the Bank and the Minister after-

 

   (a)   meeting all expenses for such year;

 

   (b)   making provision for bad and doubtful debts;

 

   (c)   making provision for depreciation of physical assets;

 

   (d)   making provision for pensions, gratuities and other benefits for its officers and employees;

 

   (e)   making provision for such other items as the Board may deem necessary;

 

   (f)   making good the issued capital and General Reserve balances; and

 

   (g)   deducting any amounts due and payable to the Bank by the Government.

   (2) Any net losses incurred by the Bank in any financial year shall, after the Bank has advised Government thereof, be charged first to the General Reserve and then to the Capital.

   (3) In determining profits and losses at the end of the financial year, the Bank shall clearly distinguish profits and losses arising from normal operations and profits and losses arising from exchange fluctuations.

 

7.   General Reserve

   (1) The Bank shall establish and maintain a General Reserve sufficient to enable it to accomplish its principal objectives, the amount of which General Reserve shall be determined from time to time by the Board in consultation with the Minister.

   (2) The Bank may transfer, to the General Reserve, funds from other reserve accounts which it maintains.

This section of the article is only available for our subscribers. Please click here to subscribe to a subscription plan to view this part of the article.

Please click here to login