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RBZ gets ultimatum

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Time Bank Limited has given the Reserve Bank of Zimbabwe (RBZ) an ultimatum to return its $3 million computer system, among other assets, amid reports the financial institution is still pushing for a temporary permit to operate an investment bank.

The bank recently wrote to the RBZ’s Registrar of Banks, Norman Mataruka, requesting the return of its key assets seized when the commercial bank was placed under curatorship in 2004.

NewsDay Business was reliably informed that Time Bank was pressing ahead with its appeal to Finance minister Tendai Biti to be granted a temporary permit to operate an investment bank, while a solution to outstanding issues with the central bank was being sought.

Once a solution is in place, the sources said, the bank would resort to commercial banking.

“In fairness to Time Bank of Zimbabwe Limited, we hereby request the Reserve Bank of Zimbabwe to handover to Time Bank of Zimbabwe Limited within the next 10 days the remaining assets of Time Bank, including the computer system as per our written agreement with you, failure of which, we will regard the conduct of the RBZ and its employees as being done in bad faith and as negligent,” reads a Time Bank letter dated May 11 2012.

At the time of going to print yesterday, Mataruka was yet to respond to the bank’s letter.

Apart from the standoff on the computer system, Time Bank and RBZ were also embroiled in a dispute over a $15 million memorandum of deposit raised from the PTA Bank.

The loan was disbursed through the central bank.
On repayment, RBZ charged the bank 70% interest instead of 7%. RBZ went on to debit Time Bank’s account with a 63% excess interest.

This matter was brought before then governor Leonard Tsumba who said the bank should regard 50% of their $15 million claim as an asset on their book or as money owed by RBZ until the matter was finalised.

Sources said the bank had planned to use the $7,5 million as part of its minimum capital requirements adding Time Bank directors had also pledged a property valued at about $20 million as part of the requirements.

Sources said the bank had also approached the central bank in bid to seek a grace period to raise capital for commercial banking, arguing other undercapitalised banks had also received temporary reprieves.

The bank is said to have indicated to the central bank that it was prepared to use an alternative computer system to run an investment bank should the RBZ bestow it a temporary permit.

Takura Chris Tande, Time Bank founder, early last year indicated that the bank was seeking a temporary investment banking permit.

In 2009, the RBZ agreed to restore the bank’s operating licence after the Administrative Court ruled that its 2004 closure was illegal.

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