The Banco de Moçambique (BM) was established in 1975 by  Decree No. 2/75 of May 17, under the commitments undertaken in the Lusaka Accords in 1974. It inherited the assets and values of the Department of Mozambique from the Banco Nacional Ultramarino.

According to Article 132 of the Constitution of the Republic of Mozambique, the BM is the central bank of the Republic of Mozambique and shall be governed by a specific legislation and  the applicable international standards to which the Republic of Mozambique is bound.

The process of liberalizing the Mozambican economy, under the Economic Rehabilitation Program (PRE) in 1987, promoted the reform of the national financial system that culminated with the separation of the commercial and central functions of the bank.

The institutional separation of the BM's commercial function from its role as central bank took place in 1992, with the approval of Law 1/92, of 3 January - Organic Law - which defines the nature, objectives and functions of the BM as the central bank. Indeed, the Bank's Organic Law establishes that the BM is the central bank of the Republic of Mozambique, whose main objective is the preservation of the national currency.

The key functions of the BM are:

• Banker to the Government;
• Government's financial advisor; 
• Advisor and supervisor of the monetary and exchange rate policies;
• Administrator of the country's external assets;
• Intermediary in international monetary relations;
• Supervisor of financial institutions.