HomeLocal NewsRebounding Time Bank offers to fund white farmers’ debts

Rebounding Time Bank offers to fund white farmers’ debts

BY TENDAI MAKARIPE

ZIMBABWE’s first indigenous commercial bank, Time Bank, has announced a facility to help fund the US$3,5 billion compensation of former commercial white farmers who lost their farms at the height of the fast-track land reform programme, just two weeks after reopening its doors to the banking public.

Last year, the government undertook to pay a whopping US$3,5 billion as compensation for improvements made by farmers on the land they occupied during the colonial era.

“The purpose of the facility is to finance the payment of compensations by the government to previous farm owners (PFOs) who are covered by the Global Compensation Deed. The compensation amount will be paid through Time Bank by the Government to the PFO and Time Bank will pay such compensation in the United States dollars, cash or bank transfer,” Time Bank said in a statement yesterday.

The bank said interested former farm owners will be required to submit application forms for payments which will not exceed US$10 000 per applicant in any given period on condition that the government issues a letter of confirmation guaranteeing loan repayment.

However, the facility is yet to get regulatory approvals before it can become operational.

The bank has also unveiled plans to launch other facilities, one of which includes US$10 000 exporters loan facility at a negotiable interest rate.

The other facility, mortgage loans, will also be available in foreign currency on flexible terms for both locals and nationals in the diaspora.

“The facilities will be available after December 1, 2021, and also after approvals by the RBZ and the Finance ministry. In the meantime, Time Bank will seek such approvals,” the statement added.

Licensed in 1997, the bank mothballed 17 years ago after authorities censured it for flouting regulations. However, the closure has since been declared unlawful.

The bank became the first locally-owned commercial bank in the country and established itself on the market before other local investors moved into the sector which was at that time, dominated by foreigners.

However, a number of banks were closed by the Reserve Bank of Zimbabwe in 2004 for one reason or another and Time Bank also had its banking licence cancelled, a decision which it contested in the courts.

In a protracted legal battle, Time Bank disputed the reasons for its closure and cancellation of its licence and became the first bank to take RBZ to court over the illegal cancellation of its licence.

After its unlawful closure, the RBZ took about US$5 million from Time Bank, creating financial problems for the commercial bank.

Time Bank requested RBZ to refund the money and the former Governor of RBZ Leonard Tsumba agreed to refund the money but his term of office ended prematurely before the money had been reimbursed.

Tsumba’s successor, Gideon Gono reneged on the decision to refund the money to Time Bank, which then applied to court to compel RBZ to do so in early 2004.

After litigation started, RBZ responded by closing Time Bank and putting it under a disputed curator.

At that time, Time Bank argued that it appeared as if it was being punished for demanding its money back. During the period of curatorship, RBZ then illegally cancelled Time Bank’s licence in 2006 and the latter responded by applying for reinstatement of its licence.

In 2009, the court reinstated Time Bank’s licence but it could not operate because the RBZ refused to hand over the assets, documents and affairs of Time Bank in the normal way at the end of curatorship.

RBZ and the former curator of Time Bank could not account for all assets and documents and this resulted in further legal disputes.

Time Bank said it was probably the only bank in the banking history of Zimbabwe which managed to pay all of its depositors and employees their full amounts without borrowing from RBZ or getting new money from its shareholders or from Deposit Protection Corporation or raising new deposits in order to pay old depositors.

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