adminissuance of redeemable convertible debt securities and US$150 million in offshore lines of credit from international finance funding institutions.
Shareholders gave directors the go-ahead to raise the funding at the firm’s annual general meeting held in Harare this week.
The company also approved to change the name of the group to AfrAsia-Kingdom Zimbabwe Limited following the establishment of a partnership with the AfrAsia Bank of Mauritius.
The change of the name awaits outstanding regulatory notifications.
AfriAsia Bank gained a 35 percent stake in KFHL after an equity injection of US$9,5 million early this year.
Kingdom shareholders approved a US$10 million debt capital in September last year but agreed on a more significant capital boost for further recapitalisation of its business.
Group chairperson Ms Sibusisiwe Bango said the changing operating environment and increasing competition in the financial services sector necessitated additional funding.
The capital is expected to strengthen the capital adequacy of the group’s largest operating subsidiary, Kingdom Bank Limited.
This would lower KBL’s risk profile and enhance its ability to raise more deposits in the local market.
“The capital would also promote general corporate expansion in line with the group’s growth strategy,” said Ms Bango.
“KBL is currently unable to fund a strong deal pipeline due to the liquidity constraints that characterise the Zimbabwean market since the dollarisation of the economy in 2009.
“Enhanced liquidity through more deposits, along with the long-term funding provided by the debt capital and as well as lines of credit, will allow KBL to grow its loan book and underwrite new business, and promote general corporate expansion in line with the group’s growth strategy.”
Online Reporter