National Discount House (NDH) may also fail to meet the minimum capital requirements.
The central bank last year set varying capitalisation thresholds for the financial services sector with banks having a US$12,5 million threshold and US$10 million for discount houses.
The apex bank last November, following ZABG’S failure to meet the capital requirements, said the bank would be given, “more time to comply with the prescribed minimum paid up equity capital requirements”.
Questions sent to ZABG yesterday were not responded to at the time of going to print.
But banking sources this week told businessdigest that since the shareholders carried out due diligence early this year, the proposed plan to return the bank to former shareholders –– Barbican Bank, Trust and Royal banks –– is far from being concluded. ZABG was formed after the 2004 financial crisis led to the collapse of various banks.
Last year, three out of the 26 financial institutions — CFX, ZABG and NDH had not complied with the apex bank’s capital requirements.
But CFX has since announced that it met the requirements after Interfin Holdings agreed to underwrite the US$10 million rights issue in exchange for controlling equity.
Only Standard Chartered, Barclays, CBZ, BancABC, FBC Bank, Cabs and Kingdom had fully complied with the US$12,5million by last November.
Stanbic, which was US$900 000 short of meeting the capital requirements during the same period met the requirements by December. The bank according to its financial results released this week had standing at US$19 million by year end.
FBC Building Society according to a statement accompanying financial results will carry a rights issue seeking capital to meet the US$10 million for building societies. The company is currently US$3 million short of meeting the requirements.
Other banks are still confident that the requirements will be met. Rennaisance Bank chairman Christopher Chetsanga said: “I am confident that the bank will comply with the deadline to achieve 100% of the prescribed minimum capital requirements.”
ZABG’S failure to meet the requirements comes at a time when the International Monetary Fund (IMF) warned that risk is rising on the local banking system.
“Risks to the banking system are rising significantly and should be mitigated by stepping up prudential measures,” the IMF said on Tuesday. “In addition, RBZ governance needs to be strengthened, including through the appointment of a Reserve Bank of Zimbabwe governing board composed of reputable members and approval of an RBZ operating budget envisaging a significant downsizing and refocusing on core activities under the multi-currency system.”
The multilateral lender last month restored Zimbabwe’s voting rights after a seven-year suspension but the country remains ineligible for credit due its failure to service arrears.
“However, the economic recovery remains fragile and domestic and external imbalances are building up; therefore, significant policy challenges need to be addressed without delay,” the IMF said.