Allied Bank was struggling to meet the required minimum capital of $25 million and only had $3.4 million as its core capital.
The closure of the bank comes amid reports that the newspaper title he had also bought, the Zimbabwe Mail, is on the brink of collapse.
Mpofu bought major shareholding in the bank in Allied Bank in 2012 through his business vehicle, Trebo and Khays, when he was mines minister.
The purchase raised eyebrows over where he obtained the $23 million to buy the stake at a time the diamond industry was rocked by allegations of shady dealings and unprocedural allocation of mining licences.
The Reserve Bank of Zimbabwe (RBZ), yesterday issued a statement announcing the cancellation of the Allied Bank licence in terms of Section 14 (4) of the Banking Act (Chapter 24:20).
Allied voluntarily surrendered its licence to RBZ.
“The Reserve Bank has determined that the banking institution is no longer in a safe and sound condition in that the institution is grossly under-capitalised and is facing chronic liquidity challenges.”
RBZ will initiate the liquidation of the banking institution in due course.
The Reserve Bank will apply for the liquidation of the institution in terms of Section 57(1) (a) of the Banking Act.
Meanwhile, there is reported anxiety among employees at the Mail as the stable faces an uncertain future due to acute financial problems.
Insiders say the publication has from last year been struggling to pay workers and fund core operations as the stable is failing to attract meaningful advertising and sales are poor.
Post published in: Business