THE National Social Security Authority (NSSA) will proceed to set up a microfinance bank notwithstanding the cancellation of an operating licence of its banking subsidiary, a spokesperson has said.
Last week the Reserve Bank of Zimbabwe (RBZ) announced the cancellation of Capital Bank's operating licence on the grounds that its major shareholder, NSSA, was no longer willing to inject additional capital into the institution.
NSSA has 84% in Capital and the remainder is owned by Patterson Timba and his partners.
"NSSA is working with its parent ministry, the Ministry of Public Service, Labour and Social Welfare, and the Reserve Bank of Zimbabwe to obtain the necessary regulatory approval," the spokesperson said.
The spokesperson said appropriate notices would be issued in due course concerning payments to depositors and other creditors as per RBZ notice on the cancellation of Capital Bank's licence.
The move to surrender the licence comes after the realisation that Capital Bank needed huge capital outlay and had failed to turn around since NSSA moved in.
A NSSA board resolution called for the winding up of Capital Bank and the authority was mandated to apply for a microfinance bank licence.
Despite the rebranding exercise, Capital Bank had failed to gain market acceptance from its predecessor, ReNaissance Merchant Bank (RMB) that had slipped into curatorship.
RMB was placed under curatorship in 2011 after an investigation by the central bank unearthed the abuse of depositors' fund by founding shareholders.
NSSA moved into the then RMB in 2012 in a US$24 million deal for 84% shareholding.
NSSA said at the time it was swooping in on RMB as a gateway to First Mutual Holdings Limited (formerly Afre Corporation). RMB had 33% shareholding in Afre.
"What we have lost in Capital Bank, we have more than gained in Afre. Our intention was never in the bank, but Afre," a board member said last year.
First Mutual Holdings has interests in insurance, reinsurance and property investments, among others.
Meanwhile, NSSA has gone for nine months with a board following the expiry of the term of office of the one led by Innocent Chagonda at the end of August last year. Chagonda was deputised by David Mutambara. Other members of the board were Kennias Shamuyarira, Cecilia Alexander, Chris Hokonya, James Matiza (general manager), Rosa Dube, Joseph Kanyekanye, David Govere, Ephanos Makiwa and M. Mukondami.
NSSA has interest in banks, insurance and properties. It has 26,6% in FBC Holdings, the parent company of FBC Bank, 37,9% shareholding in ZB Financial Holdings that wholly owns FBC Bank and 10% in CBZ Holdings.
The authority also has a controlling shareholding in hospitality concern, Rainbow Tourism Group.