PEOPLE’S Own Savings Bank (POSB) is headed for a fresh start after the government recently approved restructuring proposals that will transform its shareholding structure and lead to the possible listing of the bank on the Zimbabwe Stock Exchange, a cabinet official said.
By Staff Writer
In an exclusive interview with businessdigest this week, State Enterprises and Parastatals minister Gorden Moyo said government approval had been granted for a restructuring of the bank and its listing.
“Three key issues that need to be addressed are firstly that the POSB’s original mandate of serving the grassroots people needs to be retained. There is need for the country to have a bank that specifically caters for the marginalised sectors of the economy, particularly the rural-based population. POSB’s infrastructure and distribution network has that reach. And that needs to be preserved,” Moyo said.
“Secondly, there was a proposal to introduce a commercial unit within POSB that will very be competitive. This unit will aggressively engage with other big banks in competing in the same space with them. To this end, POSB will need to capacitated through an injection of capital and additional skills.”
He said this would necessitate the creation of a joint venture with an appropriate local, regional or international partner.
“To this end, the agreed position is that government is prepared to relinquish 49% shareholding in POSB to such an identified partner,” Moyo said.
“Government would need to amend the POSB Act to align with the new strategic thinking,” he added
Detailed documents on the proposed plan, seen by businessdigest, show the decision to engage a strategic partner after amending the POSB Act. Officials preparing the restructuring memorandum made several recommendations with four options:
“These options entail invoking Section 25 subsection (3) of the POSB Act which provides for equity participation of up to 49% by the private players in POSB. This would mean that POSB’s mandate would remain unchanged and also the current corporate tax and statutory reserves exemptions would still apply.
In this regard, it is recommended that the criteria for engaging a suitable strategic partner should be biased towards the developmental and social aspects of POSB mandates,” read part of the documents.
The minister however emphasised in order to attract a suitable partner who is able to promote the current POSB mandate, several sections of the current POSB Act had to be amended.
Point of correction to the minister and a suggestion as well. It is not true that today’s POSB has the infrastructure and distribution network to cater for the marginalised. That infrastructure belongs to ZIMPOST, a company that the government has left to struggle after the unbungling of the PTC. Yes, ZIMPOST offices still conduct some POSB business on an agency basis, however the commission paid by the bank to its former sister company is laughable to say the least. For me, an employee of one of the successor companies of the former PTC, the solution lies in the POSB and ZIMPOST coming together, with government support of course, to form a POSTBANK. Examples of very successful commercial POSTBANKS are there all over the world. The banks in the Netherlands, our neighbours South Africa and Botswana are excellent examples, their Post Offices are businesslike because of their banking arms. Those with ears have heard. You cannot say you are restructuring a bank that will later DEPEND on another struggling organisation’s infrastructure and network, NO. The bank’s management has to have a say in how their bank operates as well as how their “infrastructure” looks like.
Thanks Lokayi for explaining clearly the fact that there is a difference between Zimpost and POSB. It is true that POSB and Zimpost both came from the then PTC. Zimpost has a very poor Telecommunications Network not ideal for modern day banking so it is quite difficult to say this expansion is something to happen overnight. Look at Ecocash…using a mobile network to do banking easily! The Postoffice has been in existence for a long long time but their communications systems are as old as they are….Their personnel also have limited public relations and banking expertise so here we go…as long as the infrastructure and networks are not rebuilt…we have a long long way to go..
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