Luvanda's move to calm customers came after the bank noticed that the message has been received differently by some clients who thought it has been put under statutory central bank management.
He told a news conference yesterday on his first day of duty at the bank that only the managing director was removed, an indication that the situation was not as bad as it is perceived.
The Bank of Tanzania (BoT) on Sunday suspended TIB- CBL Managing Director Frank Nyabundege and replaced him with Frank Luvanda, a top BoT supervisory official, following the bank’s unsatisfactory performance.
Luvanda said that when the central bank intervenes in the manner that some stakeholders think it is the case this time, it first dissolves the board, suspends its director and management and puts it under statutory management supervision, all of which is not the case for TIB- CBL.
"It is only the CEO who has been suspended while all the management is here, the board is still operational. That is why you see the bank continuing with its daily operations," he said.
BoT said in an earlier statement that the actions are taken to make government owned banks do better as well as strengthen the financial sector.
Luvanda however, did not go into details on the precise reasons for the central bank's move.
Suspending Nyabundege came as a surprise to many as the bank a while earlier declared it has made profits in recent quarterly reviews.
BoT said the measure has been taken to improve the oversight and performance of banks owned by the government and that the TIB corporate entity will continue to provide all banking services including payment of matured obligations.
The central Bank assured the public that it will continue to protect the interest of depositors and maintain the stability of the banking sector.
TIB- CBL is a government-owned development bank, providing strategic commercial banking services to the general public.
The BoT has taken various initiatives in the banking sector to improve efficiency and safeguard stability.
In 2018 (BoT) revoked business licenses, took possession of, discontinued operations and placed under compulsory liquidation five banks for being undercapitalized and in breach of the Banking and Financial Institutions Act of 2006 and attendant regulations.
In May, 2017, the central bank revoked the business licence of Mbinga Community Bank (MCB) PLC, located in Mbinga District, Ruvuma Region for insufficient capital.
Regulations issued in 2014 by the BoT indicated minimum capital for fully fledged banks (commercial banks and cooperative banks with countrywide network) as 15bn/-. Microfinance banks and cooperative banks with regional networks have capital requirements of 5bn/-, while community banks need a 2bn/- capital base. For development finance institutions the required level is 50bn/-, merchant banks 25bn/- and Islamic banks 15bn/-.