Premier Finance Group has announced plans to covert its merchant banking licence into a commercial bank and rebrand following its recent take-over by pan African banking group, Ecobank Transnational Incorporated.
Group chairperson Sengiya-mpumula Mlambo, said the group would be re-branded to Ecobank Zimbabwe. This is likely to take place once permission for the banking licence conversion is granted. Mlambo said in a statement to stakeholders: "We at Premier and our partners Ecobank are looking to the future of stability and sustainable growth and profitability.
"The bank is set to covert its merchant banking licence into a commercial banking licence and will be re-branded to Ecobank Zimbabwe. An application for the licence conversion has been lodged with (the) Reserve Bank of Zimbabwe (RBZ)."
The Reserve Bank of Zimbabwe has already approved the renaming of Premier Banking Corporation to Ecobank Zim-babwe. He indicated that significant progress had been made in transforming Premier Bank into a fully-fledged Ecobank subsidiary, starting with staff training and harmonisation of systems and procedures. The bank's flexicube core banking application was also being upgraded to facilitate full integration into the Ecobank network.
"The bank will leverage on the Ecobank Group's expertise to pursue more trade finance business opportunities with particular emphasis on the development of regional trade. The Ecobank Group stands ready to provide the Zimbabwean subsidiary with adequate financial and human capital to ensure that the bank returns to profitability and plays its role in the consolidation of the Zimbabwean economy," said Mlambo.
Ecobank bought into Premier Finance Group last year, with the shareholder transformation pro-cess having been completed at the end of 2010 after the pan African banking group took over 70 percent controlling interest in Premier that resulted in an injection of US$10 million in fresh capital that allowed Premier Banking Cor-poration to meet the minimum RBZ capital requirement by the set deadline of December 31, 2010.
Besides Premier Banking Corporation, Premier Finance Group also owns Premier Asset Management and Premier Capital Management.
The entry of Ecobank resulted in management changes, with Len Steffen leaving the bank to allow an Ecobank appointee Daniel Sackey to takeover as managing director. Another director that resigned from the Premier board following the Ecobank transaction was Sonja Rossteuscher. Other Ecobank board representatives are Awamberg Manfred Rene and Tall Evelyne Maries.
The take-over of a majority shareholding in Premier by Ecobank means that the banking group is now almost completely foreign-owned.
Mlambo said local shareholding in Premier would increase to 30 percent in the short term to meet terms of an agreement with the Ministry of Youth Development, Indigenisation and Economic Empowerment.
Zimbabwe's parliament passed the Indigenization and Economic Empowerment Act towards the end of 2007, and this was gazetted on March 7, 2008. It was signed into law on April 17 2008 and provided for all foreign-owned companies operating in Zimbabwe to cede at least 51 percent of their shares or interests to indigenous Zimbabweans.