adminSenior Business Reporter
THE Deposit Protection Corporation (DPC) has identified an unnamed investor to take over Micro King, a microfinance firm of the now defunct AfrAsia Bank Limited.
In February, the Reserve Bank of Zimbabwe cancelled the bank’s operating licence after determining that the financial institution was no longer in sound financial position.
This was after its shareholders, AfrAsia Zimbabwe Holdings Limited, voluntarily surrendered the banking licence before being put into liquidation.
DPC, which was established in 2003 through an Act of Parliament to compensate depositors in the event of bank failures, moved into the collapsed AfrAsia Bank after being granted a provisional liquidation order by the High Court and started paying out depositors whose funds were locked in the bank.
DPC chief executive officer John Chikura told Business Chronicle that following a recent tender that the corporation flighted, they had identified a successful bidder who had shown keen interest in taking over Micro King.
“We’ve come up with a bidder whose offer we’ve accepted. At the moment, we can’t disclose the successful bidder but all I can say is that this particular bidder is an external one.
We’re still in negotiations to finalise some of the conditions but we already have the successful bidder,” he said.
During the bidding process, six companies, including local and regional players, submitted bids to acquire Micro King.
Among the bidders were a Zambian firm owned by the Finance Bank of Zambia chairman Rajan Lekhraj Mahtani.
The bids were submitted to the central bank.
Using premiums paid by banks, the DPC pays out a maximum of $500 per depositor, while those with higher balances are paid after completion of the liquidation process.
Micro King has been lending finance to and Small to Medium Scale Enterprises.
Since 2009, the microfinancier channelled over $200 million to SMEs.
As the economy is presently skewed towards the informal sector, micro-lending has become an important feature in lending in Zimbabwe.
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