FBCH merger gets nod

The merger will enable the enlarged commercial bank to meet the Reserve Bank of Zimbabwe’s US$50 million minimum capital thresholds by the end of this month.

At yesterday’s extraordinary general meeting, shareholders approved the transfer of 1,09 billion ordinary shares, constituting 40 percent of NSSA’s shareholding in FBC Building Society, in return for over 80 million FBCH shares. FBCBS will now be 100 percent owned by FBCH.

FBCH chairman Mr Herbert Nkala said the proposed merger had already been approved by the Competition and Tariff Commission and with the approval by shareholders, the group was going to further consolidate its position.

“It has to be noted that the move to merge the bank with the building society is restructuring for capital gains purposes and FBCH’s capital position in meeting the central bank’s minimum capital thresholds will be further strengthened,” said Mr Nkala.

Earlier this month, the group said FBC Bank and FBCBS offer retail banking services to “more or less” the target market, and this was resulting in duplication of service and products.

Meanwhile, FBCH chief executive Mr John Mushayavanhu said the group has secured lines of credit from international financial institutions.
“Last week we secured US$8 million from the PTA Bank, while we are also expecting to secure US$40 million from the Afreximbank in the next few days, a sign that they remain confident in our ability to service our dues on time,” he said.

Mr Mushayavanhu added that the Afreximbank funding would be spread over three years and that it would be used for corporate lending. “The PTA and Afreximbank funds are going to be used in the revitalisation of industry through medium-term lending, while money realised from the Treasury shares bought through previous share buybacks would be injected into the Microplan Financial Services so as to boost the micro-finance business,” he said.

He also said the diversification of shareholding in the group would see them sealing a deal with a Mauritian company interested in acquiring shares in the next few days which he, however, could not discuss “until all the loose ends are tied”.