CAPITAL Bank Corporation Limited says it will forge ahead with its plans to raise $8,6 million through a rights issue later this month for recapitalisation.
Report By Victoria Mtomba BUSINESS Reporter
The bank’s chairperson, Joseph Kanyekanye, told NewsDay last week that the bank required additional capital as it had been paying out money to depositors, which now stood at $46 million.
“There was a legal challenge, but we will proceed with the rights issue. We will have a meeting this month. The issue is, we need to have enough resources for the bank,” Kanyekanye said.
He said usually when a bank was under curatorship, it took at least two years for a bank to recover. The utterances by Kanyekanye follows a circular that was published by former Africa First ReNaissance Corporation Limited executive chairperson Patterson Timba that said the rights issue had limited disclosure.
Timba, wrote to the Securities Commission of Zimbabwe in October querying the rights issue through his lawyers Muza Nyapadi.
“Our client, therefore, notes that in this proposal, National Social Security Authority (NSSA)is the judge, jury and executor, thereby exposing the proposal as self-serving.
Given this massive conflict, is it not oppressive for NSSA and Capital Bank Corporation Limited to vote on this self-serving proposal,” Timba added.
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The circular indicates that if other shareholders that have a stake in the bank do not follow their rights, NSSA would take up the shares.
Timba also argued that the extra-ordinary general meeting should not be held until the case challenging NSSA’s ownership and control of Capital Bank Corporation, before the Reserve Bank of Zimbabwe, was determined.
NSSA gained a controlling stake of 84% in the bank following the lifting of the bank’s curatorship by the central bank in March under a $24 million deal.
The bank was rebranded from ReNaissance Merchant Bank following the injection of fresh capital and subsequent removal from curatorship.
