ZABG saga: bankers now turn to Murerwa

Shakeman Mugari



BANKERS whose appeals against the takeover of their banks’ assets by the Zimbabwe Allied Banking Group (ZABG) were recently thrown out by the

central bank will today launch an appeal with Finance minister Herbert Murerwa against the decision, businessdigest can reveal.


The bankers plan to launch an appeal against the determination made by an advisory panel appointed by central bank governor Gideon Gono to uphold the amalgamation of their institutions — Trust and Royal Bank — into ZABG, purportedly to save them from imminent collapse.


The bankers will today file their appeal papers with Murerwa to seek redress on the matter. The papers, which were being finalised by their respective lawyers this week, will be handed to Murerwa today.


In their appeals, the bankers will argue that Gono’s decision was a breach of their constitutional property rights.


They will argue that the sale of their assets to ZABG in January last year was illegal as indicated by an earlier Supreme Court judgement which ruled that the transaction was “unlawful, null and void, and of no force or effect”.


A draft document seen by businessdigest earlier this week indicated that they will also note that the amalgamation of their banks was done without the approval of the Finance minister as stipulated by Section 25 of the Banking Act.


They will argue that Gono and the panel he had appointed to look into the issue had ignored the fact that the banks had collapsed partly because the central bank had not applied the in-duplum rule to the funds advanced to the two banks for liquidity support.


Trust will argue that their debt to the central bank ran into trillions of dollars because of the exorbitant interest that was charged without due regard to the in-duplum rule.


Trust Holdings company secretary, Tererai Mafukidze, confirmed that Trust was filing its appeal papers with the minister today.


Simba Durajadi, a Royal Bank director, confirmed they were also filing their appeal today. However, he refused to give further details on their appeal.


“We’re definitely appealing against the RBZ decisions. It’s not acceptable,” he said.


Gono three weeks ago threw out the bankers’ appeal after the panel he appointed to advise him on the issue said the takeover was justified because of fraudulent activities, liquidity crisis and mismanagement that was rampant at the two banks.


In his ruling Gono said Trust and Royal directors had siphoned depositors’ funds.


He said management and directors of the two banks had disregarded good corporate governance and involved the institutions in non-core business which eventually sunk them.


Although the ruling was seen to have closed a chapter on the saga which has dragged on for the past two years, the bankers have said their fight is not over.

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