Zimbabwe: We Paid Back NSSA's Us$20m - Metbank

8 August 2019

METBANK Limited says it has paid back the US$20 million debt in Treasury Bills (TBs) to the National Social Security Authority (NSSA).

The bank's corporate secretary and legal counsel Mr Kiitu Zawanda yesterday said the TBs and interest, together with legal fees attached to them, were paid back "in full on the 24th of July 2019". His remarks follow publication of stories (NSSA seeks to attach Metbank property, The Herald August 7, 2019) that claimed NSSA had not been paid back the money and had instituted court proceedings to recover the money.

Said Mr Zawanda: "It is false that Metbank has not repaid US$20 million in TBs as ruled by the High Court and it is equally false that a writ to attach property has been issued against the bank."

He said in 2017, it entered into an agreement with NSSA where in exchange for an agreed consideration, NSSA gave the bank TBs with a face value of US$20 million for use for its third party borrowings.

"The facility held by Metbank was a performing asset and when it came to an end in December 2017, Metbank paid all the attendant fees and returned the TBs.

"It (facility) performed so well that as a result the facility was renewed on the 18th of December 2017 for a further six months through a term sheet which had a clause that it would be replaced by a subsequent agreement, which would govern the rights and obligations of the parties in respect of the TBs.

"The facility was extended on the basis of a further consideration which Metbank duly paid," said Mr Zawanda.

It added that after the six-month period specified in the term sheet, a dispute arose over the release of the TBs, with Metbank refusing to return the TBs because NSSA had failed to avail the agreement which was meant to replace the term sheet as agreed between the parties. The dispute was despite the fact that the facility was performing and Metbank had honoured all its obligations to NSSA.

"Whilst the parties were still in negotiations regarding the dispute, NSSA went to court seeking the return of the TBs on the basis of the term sheet. Metbank opposed the relief sought on the grounds that the term sheet did not constitute an agreement, but was merely a precursor meant to precede a substantive agreement between the parties.

"For Metbank, the issue was that the TBs should only be released after an agreement had been entered into and only in terms of what that agreement would have provided for.

"Both NSSA and Metbank were made aware of the judgment on 22nd of July 2019. Prior to receiving this judgment, Metbank of its own volition, wrote to NSSA on the 19th of July offering to transfer the TBs to them.

"NSSA indicated that they needed time to consult with their lawyers and after doing so, they finally accepted a full transfer of the TBs back to them on the 24th of July 2019," said Mr Zawanda.

He added that a perusal of Justice Nicholas Mathonsi's judgment shows that he largely dealt with what constituted an agreement, "and all the other issues brought to light in social media were peripheral issues which were a meniscal (sic) part of the judgment".

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