1. INTRODUCTION
This proposal highlight the background of the study ,the statement of the problem ,the research objectives ,significance of the study , delimitation and limitations of the study as well as to establish the challenges facing the credit system of Metropolitan Bank of Zimbabwe.
1.1 BACKGROUND OF THE STUDY
Metropolitan Bank of Zimbabwe is registered commercial bank, started operations on 1 February 1999.The bank has since grown to be an important player in the financial services sector in Zimbabwe. The core activities of the bank comprise Retail Banking, Corporate banking, Treasury and International Banking. Metropolitan Bank of Zimbabwe is headquartered in Harare, Zimbabwe with a total of nine branches nationwide.Metbank is the first bank in Zimbabwe to set up a Representative Office in Asia incorporating Trade Centres used top coordinate trade between Africa and Asia.
In all banking systems the most important as well as the most profitable commercial bank asset are loans and advances but these depend on the availability of deposits. Commercial banks not only supply loans to borrowers but also attract deposits from savers and in fact pay interest to those who have deposited funds in the bank. The primary reason why banks require deposits is that they create reserves; the bank can use to produce loans on which it earns interest income. But of late the bank has not been receiving adequate deposits to create reserves from both the private individuals (personal account holders) and corporates (business account holders). Among the deposits are statutory reserves, FCA balances, ZIMRA money and government money in transit which can not be lent out.
As at October 31, 2009 the total deposits with banks amounted to US$ 1,016 billion, up 44 percent from US$ 706 million and US$ 376 million recorded in June and March 2009.But are still overly low compared to US$4 billion in Botswana and US$2 billion in Zambia.CBZ had the largest deposits with a...