The mission of the Central Bank of Swaziland (the Bank) is to foster financial sector stability conducive to economic development in Swaziland. The principal objective of the Bank as stipulated in the Central Bank of Swaziland Order, 1974 is to supervise banks, credit institutions and other financial institutions to the end of promoting a sound financial structure. In accordance with the Constitution of the Kingdom of Swaziland Section 206 (2) (d) and (f), the Central Bank shall supervise the operations of financial institutions in the Kingdom and shall promote monetary stability and a sound and stable financial structure in Swaziland.
Monetary stability refers to a stable price level in the economy that does not change much over time. Financial stability is more difficult to define than price stability, which simply relates to among other indicators, a stable inflation environment and the internal and external value of the currency. The Central Bank of Swaziland defines financial stability as a “condition in which the financial system- comprising of financial intermediaries, markets and market infrastructures- is capable of withstanding internal and external shocks such that participants have confidence in the system.”
The global financial crisis has shifted many central banks’ objectives from only considering price stability but to also considering financial stability as an important objective in the primary functions.
A stable financial system fosters a sustainable level economic growth through investment, employment and production in the economy. Financial stability is not a sufficient but a necessary precondition for sustainable economic growth.
The mandate of The Central Bank of Swaziland includes particular responsibility for financial stability as the Bank is responsible:
The Bank can accomplish this macro-prudential mandate through steps that entail:
In this regard, the Bank has established a Financial Stability Committee (FSC), which meets regularly. Its membership consists of the General Managers of the Bank and it is chaired by the Governor of the Bank.
The Bank will issue a Financial Stability Report twice a year.
Swaziland participates in the International Monetary Fund’s exercise in compiling financial soundness indicators.
Relevant website links to include under FSU page: