How Kanyekanye was forced off bank board

THERE was intense drama this week after the National Social Security Authority (Nssa) board of directors called an urgent meeting to compel a fellow member –– Joseph Kanyekanye –– to step down from the board of Capital Bank in line with its board resolution adopted last month.

Report by Chris Muronzi

The Nssa board had resolved mid-June to retire all individuals seconded by the social security firm to represent its interest on boards of companies it has invested in.

While the resolution was welcomed by corporate lawyer, Innocent Chagonda, who stepped down as chairman of Afre Corporation early last month, Kanyekanye resisted the resolution.

According to a source on the Nssa board, Kanyekanye had until June 30 this year to step down from the board of Capital Bank and Rainbow Tourism Group (RTG), but had not done so by Monday, forcing the board to call an urgent meeting to arrest the unfolding corporate spectacle.

The sources said although Kanyekanye later announced his resignation as chairperson of both boards on Tuesday night, he had done so under pressure.

Kanyekanye called various media houses on Tuesday to announce his resignation, a week and a few days later from the deadline.

“We had to call a meeting of the board to deal with the Kanyekanye issue,” the source said. “We wanted all chairpersons sitting on the boards of companies we had investments in to step down by June 30. We had no problems with Chagonda, but Kanyekanye had not done so by July 9, forcing other directors to call for a meeting.”

In his letter of resignation seen by businessdigest this week, Kanyekanye made sensational claims that management at the bank could be rewarding itself unauthorised salaries.

In a letter dated July 9 to the Capital bank board of directors, Kanyekanye said: “The immediate imperatives for the bank is to push for a board approved turnaround strategy, recapitalisation and deal with incorrect implementation of the total costs remuneration that resulted in managerial staff paying themselves unauthorised salaries while restoring independence of the board.”

The letter goes on to say:“This (resignation) is done to comply with a resolution I fully supported that we made at Nssa to have an independent chairperson in all Nssa investments. I will remain a director of the bank and Nssa.”
Although Kanyekanye claims he is still an independent director on the board of Capital Bank, sources at Nssa say because of previous allegations he faced at the bank, they would prefer he steps down completely.

Capital Bank CEO Lawrence Tamayi denied management was getting unauthorised remuneration.

“I vehemently deny this. The onus is on the author of the letter to prove these allegations,” said Tamayi.

Another source said Kanyeka-kanye could, however, remain an independent director at RTG where he has a clean slate.

This comes in the wake of a myriad of allegations ranging from poor corporate governance, abuse of his position to secure employment for an acquaintance –– Tambudzai Zindi –– at Capital Bank. Zindi was a former colleague of Kanyekanye’s at the Confederation of Zimbabwe Industries where he was president.

He also sits on the Nssa board.

At the time of going to print, Kanyenkanye had not returned our calls including SMSs seeking his comment. Nssa emerged with an 84% stake in RMB, now Capital Bank after a deal involving a combination of cash and conversion of debt to equity was inked early last year.

RMB was a merchant bank formerly owned by Patterson Timba, Dunmore Kundishora and Clementine Sibve, which ran into problems owing to breakdown of corporate governance structures.

Nssa also acquired Econet Wireless Zimbabwe’s 19,7% stake in Afre last year and was already holding more than 32% through RMB. This comes after allegations emerged three months ago that Kanyekanye had benefitted from loans from the bank, a charge he was later acquitted of.

“I also wish to thank you for your support and professionalism especially in the manner you handled malicious allegations on fictitious loans that were publicised as being given to me and my wife,” the letter reads.