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| Mozambique Central Bank’s new headquarters in Maputo |
Mozambique’s central bank has ordered the closure of privately owned Nosso Banco, it said at the weekend, less than two months after a liquidity crunch and bailout of the southern African nation’s fourth largest bank, Moza Banco.
The Bank of Mozambique said Nosso Banco had continued to face weaker earnings growth and was poorly capitalized even after its management presented a recovery plan in 2014 that included pumping cash into the bank and tweaking its management structure.
“The bank has shown that it is unable to overcome the difficult economic and financial situation in which it finds itself,” the central bank said in a statement posted on its website.
Nosso’s 2015 accounts show it has 76 employees.
Mozambique’s economy and currency have been hit hard this year by a financial crisis stemming from more than $2 billion in foreign borrowing since 2013 that was not included in the budget or approved by parliament.
The International Monetary Fund and foreign donors have cut off support, saying they were kept in the dark about the debt, much of which was spent on building a state tuna-fishing company and enhancing maritime security.
The central bank has guaranteed all consumer deposits held at Nosso Banco, it said.
