17 August 2012

Zimbabwe: ZB to Increase Deposit Market Share

ZB Bank hopes to increase its deposit market share to at least 10%, helped by the bank's on-going countrywide branch roll out, ZB group head of business development Shadowsight Chiganze said.

He told businessdigest this week that the bank's market share of deposits was currently at 6,3% but this could be increased to 10%, as the bank opened new branches in economically active areas across the country.

A branch had recently been opened in Kariba and feasibility surveys were being taken in other areas. ZB currently has 54 branches countrywide.

Chiganze said the group had bought back 8,6% of its issued shares out of a target total of 10% of its issued capital.

ZB Holdings, the bank's parent company, was also in negotiations with a potential investor to raise US$100 million to meet the Reserve Bank of Zimbabwe (RBZ)'s new minimum capital requirements.

ZB Holdings Ltd CEO Elisha Mushayakarara last week said his group had agreed with shareholders to merge ZB Bank and ZB Building Society, and an application for the process had already been submitted to RBZ and was awaiting approval.

"We have already agreed with the shareholder and the board to take that route. I would like to believe the RBZ will expedite the merger process," Mushayakarara said.

ZB Bank is currently capitalised at US$38 million.

RBZ Governor Gideon Gono early this month announced new minimum capital requirements for commercial and merchant banks to US$100 million from US$12,5 million and US$10 million, respectively.

Banks are to submit their compliance proposals next month and to fully comply by 2014.

Gono, however, said there would be flexibility for those banking institutions that will be experiencing challenges in complying with new capital requirements as they will be given up to end of December 2015 to consummate their recapitalisation initiatives.

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