Saruchera’s six months term ended last week but was extended by two months to allow the finalisation of discussions that would give NSSA control of the bank.
If the deal sails through, NSSA would have 84% in the bank with the remainder owned by ReNaissance Financial Holdings Limited (RFHL). Currently RFHL wholly owns the bank. Saruchera told Standardbusiness on Friday that the parties were working to ensure that negotiations are pursued to their logical conclusion.
“We are not facing any challenges on this transaction because we have the necessary approvals from all stakeholders which include the RBZ (Reserve Bank of Zimbabwe), the depositors, the foreign financiers, management and staff, the RMB board and the sole shareholder of the bank — RFHL,” Saruchera said in written responses.
Asked how much he had collected from organisations and individuals who owe the bank, Saruchera said: “We are not in a position to discuss the specific details pertaining to collections because of the need to ensure confidentiality on all matters relating to the affairs of the bank.”
Close sources said on Friday the deal was almost sealed and negotiations would be concluded within the next two weeks.
“The fact that Saruchera’s term of office was extended by two months is an indication that something is in the offing. Everyone is convinced that the deal would be concluded,” said people familiar with the developments.
RMB was placed under recuperative curatorship in June following an investigation by the central bank which showed that the bank was technically insolvent after the founding directors had allegedly spirited away depositors’ funds.
An RBZ report said the bank is technically insolvent and needs US$32,2 million to comply with regulatory capital requirements. According to the report, RMB has a negative capital of US$16,7 million a figure disputed by founder, Patterson Timba.
The pension fund had earlier shown an interest in the banks when problems surfaced but backtracked when “politics” entered the fray.
When RMB was put under curatorship, Finance Minister Tendai Biti said he had identified a deep pocketed investor to bail out the bank and avoid the contagion effect spreading in the banking sector.
However, Biti’s intentions were construed as an attempt to bailout Timba.
NSSA’s interests were aroused when it was invited by the curator to invest in the bank and resuscitate it. NSSA wants RMB due to its 33% stake in Afre Corporation.
Initially the shares were owned by RFHL, but were pledged to the bank as security over a loan. In addition, NSSA has US$8,9 million sucked in RMB and with chances of getting it back limited, this reinforces the idea of converting debt into equity.
For NSSA, getting 84% of RMB would move it closer to Afre.
Afre’s arm, Pearl Properties, has various properties across all cities and towns and NSSA was considering investing in property to diversify its assets class.
The placement of RMB under curatorship came as the central bank said it had no appetite for curatorships. Until the events at Renaissance, no bank had been placed under curatorship since the then CFX Bank was put under the helm of Fungai Kuipa in 2004.