The Infrastructure Development Bank of Zimbabwe (IDBZ) is aiming to offload some of its government shares to boost its capital base which now stands at $48,5 million.
BY TATIRA ZWINOIRA
IDBZ is seeking to offload shares to its minority shareholders that make up 1%, but have access to additional and foreign lines of credit, IDBZ chief executive officer Thomas Sakala told NewsDay in an interview, adding government will offload part of its shareholding through a rights issue.
The Reserve Bank of Zimbabwe accounts for 13% shareholding in IDBZ.
“With the rights issue programme, we are opening up to existing shareholders government shares which they can buy in order to increase our capital,” Sakala said through the bank’s acting chief marketing and public relations officer Priscillah Zvobgo.
The minority shareholders are Fidelity Life Assurance, Finnish Fund for Industry Co-operation, The African Development Bank, German Investment and Development Company, Netherlands Development Finance Company and the European Investment Bank.
These minority shareholders are well-oiled institutions with access to lines of credit that can boost the capital base of the IDBZ. IDBZ last week received $20 million fresh capital from government.
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Keep Reading
The financial institution currently has a medium term strategy, which will run from 2016 to 2020, premised on the country’s economic blueprint ZimAsset. Under this strategy, the bank has developed a roadmap which will see it achieve a capitalisation level of $250 million by 2018.
As government remains the current shareholder, reaching the $250 million might prove difficult due to competing interests while revenue continues to shrink.
IDBZ was setup as a means of providing credit to key sectors of the economy, namely, towards infrastructure projects.
“From its improved capital position, the bank has set up a project preparation and development fund facility with an immediate allocation of $2,5 million. This is projected to be boosted to $5 million by the beginning of 2017,” Sakala said.
“The absence of bankable projects with up to date feasibility studies confirming overall project viability partly explain the slow uptake of the mega deals concluded in the recent past by the country’s leadership.”
He said it is hoped that these internal resources will be complemented with support from external resources to attain a level of $10 million in the near future.
