HomeBusiness DigestAfrasia Bank mulls short working week

Afrasia Bank mulls short working week

AFRASIA Bank Zimbabwe Ltd is mulling sending its workers on a two-week unpaid leave every month as it grapples viability problems, businessdigest has learnt.

Kudzai Kuwaza

Sources at the bank said at a recent works council meeting, which is represented by management and worker representatives, management proposed short working weeks as means to keep the business afloat, but the proposal has met stiff resistance from workers.

“Management proposed that employees work two weeks a month which will automatically mean that our salaries are halved. The workers refused this option preferring instead to get retrenchment packages,” one of the bank employees told businessdigest.

“The talks are continuing but it is likely that the exercise to reduce working weeks will eventually be implemented despite our protests,” the worker added.

The proposal to send employees on two weeks’ unpaid leave comes against the backdrop of a retrenchment exercise by the bank last year in which 83 workers laid off.

In a response to questions by businessdigest, the bank said a proposal to change working schedules is on the table, but no decision has been made yet.

“The group advises that in light of the current challenges, work schedule reviews have been proposed in internal discussions, however nothing firm has been decided yet,” it said.

The bank also said though it is not retrenching despite the difficulties.

“At the moment there is no voluntary retrenchment. The bank has clearly laid out internal procedures and protocols that it adheres to when dealing with such issues,” the bank said.

In his Monetary Policy statement last week, Reserve Bank of Zimbabwe (RBZ) governor John Mnagudya said that Afrasia were in negotiations with a potential investor, a development expected to turnaround the business.

“The bank is currently negotiating with potential investors with the objective of taking up significant equity in the institution. It is envisaged that this development will be key to the institution’s various measures to ameliorate its funding constraints,” Mangudya said.

Sources said that the potential investor is currently carrying out a due diligence exercise on the bank.

However, the bank refused to shed light on progress in their negotiations with the investor.

“The group will be in a position to announce to the market when regulatory clearances have been secured for the strategies that are being pursued to capitalise the bank,” the financial institution said.

In the second half of 2014 RBZ closed two banks: Interfin Banking Corporation and Capital Banking Ltd. The RBZ cancelled Allied Bank Ltd’s banking licence on January 8 this year following voluntary surrender of the licence by the institution’s board of directors.

Tetrad Investment Bank was placed under provisional judicial management while Metbank also faces viability challenges.

“The Reserve Bank has engaged these banking institutions’ (Metbank, Afrasia and Tetrad) boards and shareholders with regards to the proposed turnaround strategies. As monetary authorities we continue to closely monitor progress in the implementation of the various plans,” Mangudya said in his Monetary Policy Statement.

“The Reserve Bank’s objective is to ensure that the financial sector is free from distressed banks by June 30 2015.”

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