adminFebruary 2012.
The central bank also extended the appointment of the curator, Mr Reggie Saruchera, by the same period.
RMB was placed under curatorship last June for six months to allow for investigations and to institute corrective measures following dealings that allegedly exposed the bank to a negative capital of US$16 million.
In a statement, the registrar of banking institutions, Mr Norman Mataruse, said: “The Reserve Bank of Zimbabwe has extended the period of curatorship for ReNaissance Merchant Bank Limited from December 2, 2011 to February 2012.
“At the same time the Reserve Bank has extended the appointment of the curator.”
The extension of the curatorship is to allow the curator to complete a robust framework to bring about the bank’s recovery and lasting stability.
Central bank governor Dr Gideon Gono had indicated that the primary purpose of the curatorship was to protect depositors, preserve RMB’s assets and the stability of the financial sector.
The RBZ moved into ReNaissance in April this year to investigate the affairs and ascertain its financial position, including profitability, liquidity and solv-ency.
RMB has been in trouble since 2009 and as at December 31 last year, had reported core capital of about US$4,4 million, which was lower than the prescribed minimum capital requirement of US$10 million for merchant banks.
RMB operates under the Renaissance Financial Holdings stable.
RMB’s curatorship sent tremors throughout the market, reminiscent of the 2004 financial crisis in which a number of banks closed down.
The transacting public is now sceptical of financial institutions, as depositors have lost money in the past when the sector was fragile.
Some banks are struggling to gain public confidence due to undercapitalisation and micro-economic pressures.
Since the inception of the multiple-currency system in 2009, the sector has experienced a crisis of depositor confidence and capital inadequacies.
Prevailing liquidity risk has exposed many banks that are still dealing with liabilities incurred during the 10 years of economic recession.
Liquidity risk is the risk a financial institution encounters in meeting the obligations of its financial liabilities and often arises from assets and liabilities having differing maturity periods.
Meanwhile, Dr Gono cleared the air when he said the banking sector was “safe and sound” as the central bank had maintained tight monitoring and supervision.
Online Reporter