HARARE – Zimbabwe Stock Exchange listed financial services group, ZB Financial Holdings Limited (ZBFHL), has surrendered the operating license of its banking unit, ZB Building Society, after failing to meet the minimum regulatory threshold.
The Reserve Bank of Zimbabwe (RBZ) directed that all commercial banks should have a minimum capital of US$30 million or the Zimbabwe dollar equivalent by December 31, 2021 while the building societies, merchants bank and discount houses should have a capital of US$20 million or its equivalent in local currency.
Most banks met the regulatory threshold by December 2021 including ZB Bank, a commercial banking unit of ZBFHL.
However, ZB Building Society failed to meet the minimum capital threshold.
The RBZ , however, gave ZB another 12 months to December 31, 2022, to meet the capital threshold.
But it failed.
The development was confirmed by sources at ZBFHL.
A source told The Anchor: “We decided to surrender the license of ZB Building Society just before the deadline of 31 December 2022.”
Efforts to get a comment from ZBHL chief executive officer, Shepherd Fungura were unsuccessful.
Apart from capitalising ZB Building Society, ZBFHL was also pursuing another option to ensure compliance, that is to merge the two banking operations, the commercial bank and the building society , to create an imposing banking unit.
The plan was approved by the ZB board in 2014.
But, this route also failed following a long standing wrangle with businessman, Nicholas Vingirai, who controls Transnational Holdings Limited (THL), the parent company of Intermarket Holdings, which controlled Intermarket Building Society, which was taken by the Government of Zimbabwe in 2006 after Vingirai went into exile two years earlier after being subjected to investigation on allegations of violating exchange control laws.