Trust Bank in trouble

The bank last week failed to meet some of its financial obligations after a number of its clients failed to access their funds, amid strong indications it could have lurched into some sort of liquidity crunch.

Trust Holdings group chief executive Mr William Nyemba said no communication had been relayed to him about the liquidity crisis, but admitted that, like other banks, Trust Bank experienced liquidity challenges especially after the Easter holidays.

“The liquidity problem is not an issue confined to Trust Bank alone,” he said, “and cash has been a problem, especially after the (Easter) holidays. But I have not been notified that there is a problem.

“One of the factors (for liquidity crisis) is capital and we have concluded discussions with one of the major shareholders.
“We have a shareholder who will inject US$9 million to US$13 million — the US$9 million is confirmed.”

Trust has issued various cautionary statements advising that it was engaged with investors in search of fresh capital investment. The bank has also recently been linked with Allied Bank.

Trust Bank, with US$18,7 million, remains below the central bank’s minimum prescription of US$25 million and way off the US$100 million threshold expected by June 2014. Last Friday, a number of the bank’s individual and corporate clients besieged the bank’s head office, to seek an explanation for the bank’s failure to fulfil its side of the bargain.

Dr Panache Chiurunge of Chartered Integration Systems said he had failed to make his Value Added Tax payment to the Zimbabwe Revenue Authority because Trust Bank had no cash.

“As a result of that, Zimra have effected a 100 percent penalty on the outstanding amount,” he said. “Who is going to pay for that?”
He said he had asked to make a Rapid Transfer Gross Settlement and access the funds from another bank — to no avail. Mr Billion Tabi and Mrs Maria Madhwu were also among the bank’s customers besieging one of the branches to demand explanation over their failure to access their funds.

Operations manager Mr Greg Gatsi said he had lodged a complaint with senior management who could not address the visibly angry customers because they were reportedly locked up in meetings.

Reserve Bank of Zimbabwe Governor Dr Gideon Gono recently said the banking sector was “in a healthy state” and none of the banks had shown any signs of stress.