DPC finalises MicroKing sale

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Microcred and AfricInvest have concluded the acquisition of MicroKing in a deal that will see the investment of US$25 million in the micro-lending business, businessdigest has established.

Kudzai Kuwaza

Sources close to the deal this week said the Deposit Protection Corporation (DPC) has completed the sale of MicroKing to European investors.

DPC CE John Chikura

DPC CE John Chikura

MicroKing is a subsidiary of AfrAsia Zimbabwe Holdings Ltd (AZHL).

AZHL flagship unit, AfrAsia Bank, surrendered its operating licence in January.

In his mid-term monetary policy statement, Reserve Bank of Zimbabwe governor John Mangudya said a consortium of European investors, Microcred and AfricInvest, would invest US$25 million in the microfinance unit.

“The investors will have a 100% stake in MicroKing and they can regularise as they go. We are concerned about the depositors’ funds and the resuscitation of the bank,” he said.

MicroKing was closed due to problems emanating from its parent company.

“The DPC has finalised the sale agreement of MicroKing to MicroCred and AfricInvest,” an informed source told businessdigest.

This comes after the sale of the banking group’s asset management subsidiary now trading as Smartvest.

Meanwhile, the forensic audit of AfrAsia, which was commissioned in October last year, is set to be completed soon.

“The audit of AfrAsia Bank is almost complete and we expect it to be finalised soon,” a source revealed.

The DPC commissioned a forensic audit into the operations of AfrAsia and Royal banks in a bid to prosecute shareholders or owners of banks found guilty of abusing depositors’ funds at the behest of the creditors of the two financial institutions.

The corporation is determined to institute both criminal and civil charges against bank owners and shareholders who are found guilty of having defrauded depositors.

In an interview in June last year, DPC CE John Chikura said delays by the central bank in withdrawing licenses of distressed banks had allowed shareholders and management in the troubled institutions to strip assets, leaving very little for affected depositors.

“The delays by the Reserve Bank to close distressed banks gave shareholders and management time to strip assets. By the time it is liquidated, it’s a shell,” Chikura said, adding the RBZ needed to move swiftly when closing banks to protect the interests of depositors.

“Let me give you an example; when Interfin went under curatorship in 2012 the gap was US$98 million, but when it was liquidated last year the gap had increased to US$158 million. This was an unnecessary increase of US$60 million.”

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