Trust Holdings Limited says it is courting South African investors to take over a 25% stake that was formerly held by First Mutual Life when the two companies had a share swap as it recapitalises.
Group chief executive officer William Nyemba on Friday said: “a couple of investors from South Africa have showed interest to snap up the 25% that used to be held by First Mutual Life. This will bring money to the bank.”
First Mutual Life and Trust Holdings had a share swap deal before the latter was placed under curatorship in 2004.
Nyemba said the company had failed to reach its target of breaking even by June this year but anticipate to return to profitability by year end.
Referring to the placing of Renaissance Merchant Bank under curatorship Nyemba said: “There is a lot of dust in the air. We are no exception; the effect was felt more in the past three weeks. We will begin to have a sigh of relief,” he said.
“We thought in June we would start to break even but I think with the unfortunate development we need to deploy some tactics to go back to profitability. We have to relook and recapitalise.”
A report released by International Monetary Fund mission chief for Zimbabwe Vitaliy Kramarenko last week said seven banks were persistently undercapitalised, of which a number were insolvent.
“The RBZ needs to ensure sound loan underwriting standards and practices in banks to prevent wider problems in the banking sector,” Kramarenko.
“For undercapitalised banks, banking supervision needs to intervene swiftly to resolve banks that fail to restore compliance with minimum capital requirements, not extend deadlines for previously noncompliant banks, and restrict the payment of dividends.”
Trust said it had surpassed the minimum capital requirements. Trust bank was relicensed on September 1 2010 and commenced operations in December the same year.
The holdings company’s subsidiaries include Trust Bank Corporation Limited, Trust Risk services limited, Trust properties Pvt Ltd, Trust Agriculture.
Trust Holdings holds 100% in Trust Bank Corporation and Trust risk service while it controls 90% stake respectively in Trust properties and Trust Agriculture.