LISTED conglomerate Meikles Limited says foreign banks have not shown an interest in the Treasury Bills (TBs) it was holding as part of payment by government on the outstanding debt owed by the Reserve Bank of Zimbabwe (RBZ).
Meikles is owed $90,8 million by RBZ which has been assumed by government as part of measures to free the central bank of its $1,35 billion debt.
In a statement accompanying the audited financial results for the year ended March 31 2014, Meikles board chairman John Moxon said the company received $49,6 million worth of TBs and the balance would be settled once government has completed its required processes.
TBs are short-term maturity promissory note issued by a national government as a primary instrument for regulating money supply and raising funds via open market operations.
“The company has been testing its ability to market the Bills in the local market. Efforts to date have focused largely on local banks. Some significant success has materialised from these efforts. Foreign banks operating in Zimbabwe have failed so far to demonstrate an appetite for the Bills,” Moxon said.
Moxon said there had been positive interaction with local financial institutions outside of banks.
“These institutions are likely to have a longer investment time frame capacity than banks. This interaction is progressing and subject to some revision of some terms of the Treasury Bills, success looks possible,” Moxon said.
He said discussions with authorities were continuing on an amicable basis “with a view to ensuring that the Treasury Bills are on terms that will be acceptable in the market”.
Government has been using TBs to meet obligations and settle outstanding debts. This year government issued TBs worth $103 million to repay part of the central bank’s debt to banks and farmers which accumulated during the pre-dollarisation period. An amount, $93 million will be repaid to banks and $10 million to tobacco farmers.