HomeBusiness DigestRBZ firm faces collapse

RBZ firm faces collapse

Roadwin Chirara

A COMPANY jointly owned by the Reserve Bank of Zimbabwe and the Ministry of Finance, Climax Investments, could fold because of serious financial problems.

“Verdana, Arial, Helvetica, sans-serif”>The company plunged into problems after it lost its clients last year. Before the crisis, the company specialised in debt management but lost clients after the RBZ launched its Productive Sector Facility last year.

The company is said to be failing to generate enough revenue to sustain its operations. Climax was also a victim of last year’s financial crisis, which saw many asset management firms and banks closing down.

Problems worsened after its $1,7 billion investment was locked up in troubled National Discount House (NDH).

The board, chaired by former Finance minister Tichaendepi Masaya, is understood to be making frantic efforts to save the company which sources say could sink soon.

The directors recently met and decided to diversify their business into asset and fund management.

It is diversifying from solely debt management to broaden its revenue streams.

The board is also said to be at loggerheads with staff members over the appointment of Victor Mkotsanjera as an executive director of the company.

Staff members are said to have questioned his qualification and ability to turn around the fortunes of the company, especially during the current difficulties.

Masaya denied that the company was in trouble but confirmed that it has now shifted from debt management to asset management and equity investments.

“There is nothing wrong with the company moving from debt management to investments considering there is now low business in that area,” Masaya said.

“Everyone has a right to exercise his or her options with regards to their investments and we have exercised that right,” he said.

With regards to the appointment of Mkotsanjera as executive director, Masaya said there was “nothing wrong with the appointment”.

“Anyone, even your uncle, can come and be appointed to the board, there is nothing wrong with that. Why do people just look for something to talk about?” he said.

Masaya denied allegations that Climax was selectively investing in businesses closely linked to some member on the board.

He confirmed that the company had lost $1,7 billion in NDH.

“Yes, we have funds tied up in NDH and we exercised an option of turning the debt into equity.”

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