committees   convene   weekly   and quarterly respectively. The Bank maintains high professional standards in evaluating all aspects of credit proposals, specifically FBZ ensures the business managerial, financial, structural and security aspects are sound and that the undertaking is financially and commercially viable. The Bank has a credit policy document in place which conforms to the requirements of Bank of Zambia. The Board is responsible for establishing policies and reviews the FBZ’s performance to ensure compliance with the credit policies in place and Bank.

OVERDRAFT FACILITIES

Overdraft Facilities are available to customers who require variable cash-flow support for the daily operations of their businesses. A maximum limit is established on the customer's current account and the balance will vary within the limit. Turnover on accounts with overdraft facilities is high and facilities are usually for less than 12 months.

STAND-BY OVERDRAFT FACILITIES

Stand-by Overdraft Facilities are available to customers who require ad-hoc cash-flow support for the operations of their businesses. A maximum limit is established on the customer's current account and the balance will vary within the limit, but will primarily be running on a credit balance.

• COST

For overdraft and stand-by overdraft facilities interest is calculated on daily basis at an agreed rate on the outstanding amount.

SHORT TERM LOANS

Short Term Loans are available to enable customers to purchase assets whilst matching finance costs to cash flow produced by the investment.

MEDIUM TERM LOANS

Medium Term Loans are designed to help our customers with items of a capital nature such as improvements to their premises, factories and/or purchases for equipment and processing machinery. Term loans, are for a specified fixed period with agreed repayment schedules over an agreed period normally not exceeding 6 years.

PROJECT FINANCE

Project Finance Loans are for large-scale civil engineering and construction operations including housing projects. Significant finance is usually obtained from international sources and is committed to long-term ventures.

CONSTRUCTION LOANS

Construction Loans are term loans of specific amounts, for construction purposes. Loans are drawn down at various stages against the production of Architect's certificates, Engineers/Quantity Surveyors certificate or similar documentation.

• Such loans are available to property development companies, building construction companies and the security required is the asset being financed or an alternative equivalent.

• Repayments of the outstanding loan will not normally commence until the project is completed.

SYNDICATED LOANS

Bank of Zambia has set guidelines with regard to credit concentration and group companies or individual exposure.  This means that we cannot lend money over a certain limit. In such cases Finance Bank is capable of and has sourced funds by involving other banks either locally or internationally to form a syndicate. Each bank commits to contribute a proportion of the loan under the terms of a single loan agreement between the lending syndicate and the borrower. The Syndicate lenders will agree on pricing that normally includes an Arrangement Fee, Management Fee and a Commitment Fee.

SEASONAL WORKING CAPITAL FACILITIES

Seasonal Working Capital Facilities are provided to customers who have a seasonal cash-flow and who require front-end financing to enable either production, harvest or manufacture of certain commodities or items for which there is a specific seasonal demand or cycle. Typically, seasonal facilities are geared towards agricultural businesses and are available in local and foreign currency denominated loans.

• FOREIGN CURRENCY FACILITIES

Foreign Currency Facilities are available to exporting customers to enable them produce and/or procure commodities and crops like copper, cobalt, tobacco, cotton, ground-nuts etc. locally, for export.

Loans are made available against firm orders or against inward letters of credit.

Funding is available locally in US dollars, Sterling or Rand, and then converted to Zambian Kwacha to enable local commodity purchases and expenses.

The foreign currency receivables repay loan within an agreed period in foreign currency of borrowing.

Interest is charged at a LIBOR (London Inter-Bank Offered Rate) based rate, plus a margin.

Customers also have a hedge against devaluation, as they borrow in dollars, receive dollars for their exports, and repay dollars to the Bank.

• COST

For short and medium term loans, interest is calculated at an agreed rate over the full amount of the loan or the outstanding amount which ever is the case.