Met Bank sold for a song

mushinda – who held a 25 percent stake in Met Bank – during the height of the banking sector crisis in 2004, ostensibly because depositors’ cash was at risk.
Top-level RBZ sources alleged to The Zimbabwean that Gono used his influence to arm-twist Norman Mataruka, the senior division chief of Bank Licensing, Supervision and Surveillance division, into approving the sale.
They allege that the transaction, concluded in April this year, did not follow proper procedures as Gono “unilaterally approved the sale without seeking authority from the Finance minister as provided for under the RBZ Act Chapter 24:20”.
Gono was said to have contacted his colleagues at Loita Capital, with whom he had close links during his tenure as Commercial Bank of Zimbabwe (CBZ) CEO, by-passing the Exchange Control Review Sub-Committee that is mandated to scrutinize such transactions.
It was not possible to obtain comment from the divisional chief of the RBZ Exchange Control, Morris Mpofu.
Questions sent to the RBZ head of public relations Tonderai Mukeredzi and also copied to Kumbirai Nhongo were not responded to up to the time of going to print.
Our source said the Bank Licensing, Supervision and Surveillance Division did not have the prerogative to approve transactions where foreigners were snapping up stakes in local companies. It can only provide advice to the Exchange Control Review Sub-Committee.
The Zimbabwean heard that a 60 percent stake in Met Bank is actually valued at US$1,3 million and that the country was actually prejudiced of desperately needed US$1 million in this transaction.
Our source alleged that Loita Capital had offered US$600,000 for Met Bank but Gono allegedly pocketed US$300,000 and presented the transaction to the Finance minister Samuel Mumbengegwi as US$300,000.
In a letter dated May 27, 2007, a month after the transaction was concluded, Gono wrote to Mumbengegwi “informing” him about the transaction and justifying the paltry sum for which he sold the bank on the basis that Loita Capital had offered to provide Zimbabwe with a US$50 million loan facility to bankroll key imports such as grain. He told the minister in his letter that Met Bank would administer the loan.
Repeated efforts to obtain comment from Mumbengegwi were futile.
Our source said there was no guarantee that Loita would honour its promise, as they were not under any obligation to make the loan available.
“Surely the stake could have been offered to locals. I am 200 percent sure they could have raised the US$300,000,” said our source. “One only needs to sell an average house in Harare’s low density suburbs to raise this amount.”
The highly-placed source said it was “ludicrous” for Gono to wrestle control of a bank owned by Kamushinda, a Zimbabwean, and sell it to a foreigner.
During the greater part of 2004, Gono – who was appointed RBZ governor in December 2003 – shut down almost all indigenous banks amid reports he targeted those he had personal clashes with during his tenure as CEO at CBZ. There has also been controversy over the manner in which he has handled the stake in failed banks.
Our source said the financial scandal echoes the Pinnacle Properties saga, in which Gono unilaterally approved a deal for Phillip Chiyangwa for him to sell houses in foreign currency without first seeking approval from the finance minister.