TETRAD Investment Bank (TIB) creditors have agreed to defer claims by another three months to January 31 next year to allow the troubled institution to recapitalise.
BUSINESS REPORTER
In August, 84,94% of the bank’s creditors voted for the scheme meeting that agreed to defer claims until October 31 to allow processes to recapitalise the institution.
A Russian investor, Horizon Capital Consortium, is eyeing a controlling stake in the bank and its representative attended the August scheme meeting.
In a notice yesterday, chairperson of the scheme meeting Retired Justice George Smith said the extension of the scheme followed consultations with creditors.
“After consultation with the creditors of the bank in accordance with paragraph 2,2 of the provisions of the order the High Court order dated 24 September 2014, I hereby declare that the Scheme is extended from 31st October 2014 until 31 January 2015,” Smith said.
Before the August meeting, TIB’s assets had come under attack from creditors after the bank failed to honour its obligations and claims.
In July, the bank approached the High Court seeking relief from creditors.
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High Court judge Justice Nokuthula Moyo then ruled that Justice Smith, or any other person nominated by creditors, should chair a meeting of creditors to get a deferment on claims until the recapitalisation of the bank had been completed.
In his maiden monetary policy statement, Reserve Bank of Zimbabwe (RBZ) governor John Mangudya said TIB, alongside MetBank, Allied Bank and AfrAsia Bank, were facing liquidity and solvency challenges due to liquidity, macro and institution-specific challenges.
He said the distressed banks command low market share in terms of loans (8,8%), assets (7,2%) and deposits (6,7%) as at June 30 2014.
Mangudya said RBZ has been engaging the distressed institutions to come up with credible plans to turn around their dire financial condition.
“In this regard, shareholders and boards of the distressed banks have been directed to finalise implementation of their turnaround plans, failure of which the Reserve Bank will be left with no option but to intervene and institute appropriate supervisory action in terms of the Banking Act,” he said.
In a recent interview with NewsDay, Tetrad Group chief executive officer Eugene Mlambo said the interim relief provided by the scheme meeting would enable the bank to go forward and complete the investment transaction.
“This will ultimately return the bank to normal, allowing all of its commitments to all creditors and depositors to be met within a reasonable period of time,” Mlambo said.
