The Council of Ministers of Mozambique has issued implementing regulations for the law creating the Mozambique Development Bank (BDM), establishing its governance, capital, funding model, project eligibility rules and sanctions framework. The regulations took effect on Sept. 17 and delegate government oversight to the finance minister while preserving the bank’s administrative, financial, asset and operational autonomy. The Bank of Mozambique will exercise prudential oversight and enforce contraventions under the framework. BDM will have MZN 32 billion in state-subscribed capital, paid in annual installments of MZN 6.4 billion over as many as five years. The state may sell up to 49% to development finance institutions, multilateral banks and similar domestic or international entities. Indirect state administration bodies and state-owned enterprises must channel at least 25% of their financial investments and deposits to BDM in its first operational year and at least 20% thereafter. The framework also permits allocations from social security and pension fund portfolios, subject to solvency, liquidity and prudential safeguards, and provides for an annually determined share of extractive-sector revenue to finance strategic infrastructure and other structural projects. Governance will center on a seven-member board, comprising five executive and two nonexecutive directors, supported by independent committees for risk, compliance, appointments and remuneration, audit and investment. Financing must target projects aligned with national development policy and meeting technical, environmental and financial viability, development impact, promoter integrity and legal compliance criteria. Managers and staff may face fines of 10 to 500 banking-sector minimum wages, disqualification from management roles and other sanctions for breaches, with the Bank of Mozambique responsible for investigating and deciding contravention cases.

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