adminDaniel Nemukuyu Senior Court Reporter
ASSET-stripped Capital Bank Corporation Limited has been placed under provisional liquidation after the court ruled it was no longer viable.
High Court judge Justice Owen Tagu ruled that the bank was no longer capable of paying off its ballooning debts in excess of $35 million.
Justice Tagu appointed Mr John Chikura of the Deposit Protection Corporation as the provisional liquidator. “The first respondent, Capital Bank Corporation Limited, be and is hereby provisionally wound up, pending the granting of an order in terms of paragraph 3 hereof or the discharge of this order,” he said.
“Mr John Mafungei Chikura of Deposit Protection Corporation, be and is hereby appointed as the first respondent’s provisional liquidator with powers set out in paragraphs (a) to (h) of subsection 2 of Section 221 of the Companies Act (Chapter 24:03).”
The decision followed a successful application by the National Social Security Authority (NSSA), which took it upon itself to rescue the bank when it initially showed signs of collapse in 2012.
NSSA injected US$24 million into the ailing, bank resulting in it being removed from curatorship in 2012.
However, the bank’s performance dwindled years later, resulting in NSSA applying for provisional liquidation.
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