HomeBusiness DigestCBZ denies 'threatening' exposure to TeleAccess

CBZ denies ‘threatening’ exposure to TeleAccess

Roadwin Chirara

CBZ Holdings has said the withdrawal of TeleAccess Zimbabwe (Pvt)’s fixed network licence by the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) this week did not pose

a serious threat to the bank.

There has been market speculation that TeleAccess owed CBZ about $150 billion in loans advanced to the company since 2003 and that its collapse would send tremors in the bank. Market sources had said that CBZ was heavily exposed to the troubled company and that the withdrawal of the licence would pull the plug on the bank.

CBZ managing director and chief executive officer, Nyasha Makuvise, however dispelled the speculation saying the “bank had long severed its relationship” with Daniel Shumba’s company.

Makuvise told businessdigest that the bank had ceased dealing with TeleAccess long before the licence was cancelled. Refusing to give specific dates, Makuvise said the bank had severed ties with the telecoms company during the “course of this year”.

“TeleAccess as we speak does not owe CBZ anything. As we mentioned in the first half of the year we had an interest in telecoms of which we have severed ties,” Makuvise said.

He said the exposure of the bank telecoms company in the first half of the year was in the”region of $15 billion all of which had been provided for”.

Speculation had been rife that CBZ was likely to feel the pinch of the licence withdrawal as it had provided advanced loans for the company using TeleAccess’s license as part of collateral security.

“As mentioned before in the first half of the year, our exposure in telecoms was nothing more than $15 billion which has been paid off. Really the amount was insignificant and did not pose any significant threat to the operations of the company,” Makuvise said.

The CBZ boss however refused to disclose who had paid off the debt which sources estimated at more than $150 billion including interest.

“All I can say is that loan has been paid off but I can not say more as we are not involved in the company’s operations,” Makuvise said.

CBZ as bankers of TeleAccess have been providing advance loans to the venture since 2003.

“As a bank we offer various products and services to our customers and I really don’t see what is wrong with providing funds which as we speak have been paid back,” Makuvise said. At one time the CBZ told the market that it was planning to fund tobacco production to finance the network roll out.

There were fears in the market that in the event that CBZ was still owed the money, it was highly unlikely that the bank would be able to recover the full amount because TeleAccess did not have enough assets to cover the debt.

TeleAccess’ greatest asset was the licence which was withdrawn this week. TeleAccess does not have many assets by way of telecommunication equipment. Apart from the fleet of cars, the company only had a 112 000 line sub base station near Newlands shopping centre.

Shumba is understood to have declared some of his personal assets as part of the collateral. Among the assets is a block of flats and a computer company, Systems Technology, which he started before landing the TeleAccess licence. He also owns King’s Haven Hotel in Avondale.

TeleAccess Global Corporations, a company that Shumba owned in South Africa, is understood to be in crisis. The company is not trading and sources say most of its employees have left.

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