ONE of Zimbabwe’s iconic financial institutions, ZB Financial Holdings (ZBFH), has over the last few months been engulfed in boardroom fights which the Reserve Bank of Zimbabwe has warned could threaten the stability of the group if left unresolved. On May 12, the National Social Security Authority (Nssa), together with other shareholders, voted against the payment of the ZBFH dividend to an investment vehicle run by veteran banker Nicholas Vingirai (NV, pictured). Transnational Holdings Limited (THL)’s Vingirai had argued that after reclaiming its stake following a protracted battle, it was entitled to the payout. During this AGM/EGM, which lasted four hours, shareholders also voted against the appointment of THL’s proxies to the ZBFH board. Zimbabwe Independent projects editor Bernard Mpofu (BM) spoke to Vingirai on these and other issues. Below are excerpts:
BM: What is your view of corporate Zimbabwe?
NV: Corporate Zimbabwe is a microcosm of the nation; what you see in the nation is what you see in corporate Zimbabwe.
BM: How do you explain the resolutions that were passed during the ZBFH AGM?
NV: From issues raised by some members, it would seem that the members may not have fully understood what the government-brokered agreement was meant to achieve. It was also clear that some members have misplaced fears based on misinformation concerning the Intermarket Group.
Intermarket never collapsed as was popularly believed, but this is a story for another day.
All said, the outcome of the AGM is an affront to the intentions of government, which was to restore the group to good health and help restore confidence in the banking sector.
BM: During the AGM you said that the group faced serious consequences for endorsing resolutions that were widely seen as backing one of the majority shareholders. Are you looking to challenge the outcome of this meeting in court?
NV: THL will not be challenging the AGM outcome in court. The agreement was brokered and signed by government. It is only logical to engage government on the way forward. While some shareholders seemed contemptuous of the government’s efforts in brokering the settlement, THL remains grateful and full of respect for what government did in brokering the settlement.
BM: You also wrote a letter to ZBFH’s company secretary saying the group owes you US$2,7 million in dividend arrears. What has the group said about this?
NV: It is perhaps early to expect the group to have taken a position on this matter; it is not a small claim. Nonetheless, we remain convinced that we are due not less than US$2,7 million and it is a matter we hope can be amicably resolved because, in our view, the facts are clear.
BM: The issue of capitalising the group was one of the contentious issues raised over the last few months. As one of the majority shareholders, how would you want ZBFH to be recapitalised?
NV: With the brief glimpse I had from inside, I would like to think that the Group may well be able to capitalise itself organically. I certainly do not share in the panic echoed by some.
BM: During the AGM, the company secretary said management had communicated some important issues that need to be addressed after the Reserve Bank of Zimbabwe carried out its on-site visits. What are some of these issues?
NV: This question is better answered by the company. However, one of the directives was the merger of the bank and the building society. Although I have a different view, I question how this is going to be achieved given that ZBFH members are not prepared to dilute if the AGM resolution is anything to go by.
BM: You have endured one of the longest legal fights in trying to claim your stake. Following the last AGM, are you ready to engage in another fight?
NV: I don’t know whether to call it a fight but, yes, THL is ready to go back to court to assert its rights should it become necessary. It is important to know that this is really not about a “stake”. This is about right and wrong. This is about generations to come who in their day should be able to distinguish between right and wrong guided by the actions of the present generation. For this reason, THL is more determined than ever before to achieve a fair outcome.
Government has also made it clear that they have no delight in seeing THL unfairly dispossessed of its assets.
BM: THL was instrumental in appointing the chief operating officer (COO) of ZBFH. What will THL do to ensure that the COO designate’s appointment is regularised?
NV: Your facts are not accurate. Nonetheless, you will appreciate that this is a matter for the company to deal with.