HomeBusiness DigestHigh Court confirms Time Bank's depositor-payment

High Court confirms Time Bank’s depositor-payment

THE Master of the High Court Charles Nyatanga has confirmed that Time Bank of Zimbabwe’s agent Chadford Investments has paid about $20 million to his office as part of the closed bank’s $120 million depositor-payment scheme.

justify>The money, paid to the state-managed Guardian Fund, represents 17% of the total deposits and cash outlay amounting to $120 million.

“Yes, a sum of $20 million (being money for uncollected deposits) was paid to the Guardian Fund,” Nyatanga told businessdigest on Tuesday.

Time said it had reimbursed all its depositors from funds gathered from borrowers, which the bank’s former curator Tinashe Rwodzi of PriceWatehouseCoopers (PwC) had declared non-existent and impossible to salvage.

In recent statements, Chadford said 100% of deposits were paid.

The bank’s ability to pay also flies in the face of the PwC boss and the central bank’s failure to produce audited accounts which are necessary in proving the bank’s insolvency.

Significantly though, Time’s solvency case has been helped by Rwodzi’s own findings in March that the bank’s assets were valued at $420 million against liabilities of $407 million, giving a positive $14 million cash position.

This financial position was revealed despite the fact that the curator had understated Time’s assets by excluding key investments such as the $640 million Watermount Estate, funded by the bank in 2004 and at the centre of its woes then.

The asset list does not also include the bank’s $200 million claim on the RBZ, arising from a disputed US$15 million PTA Bank loan agreement now subject of a High Court row between the two institutions.

Critics say Rwodzi’s actions heightened the bank’s risk exposure, resulting in the view that it was grossly undercapitalised and therefore had to be deregistered. Time was subsequently deregistered on May 19, but major shareholders say the deregistration was unprocedural.

The cancellation of Time Bank’s licence was also done despite the fact that majority shareholder Time Bank Investment Company had earlier petitioned the RBZ over the curator’s actions, particularly his reclassification of Time’s debts to the RBZ as due debts and handling of the Watermount issue. — Staff Writer.

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