Reopen but don’t take deposits, RBZ tells Time Bank

TIME Bank, one of a dozen domestic financial institutions that collapsed at the height of Zimbabwe’s banking crisis between 2004 and 2008, was yesterday given the nod to re-enter the market under restricted conditions.

The financial institution will not be allowed to take deposits, according to a statement released by the Reserve Bank of Zimbabwe (RBZ).

RBZ did not say when Time Bank would return, but it said pre-opening inspection had been conducted, ending with a nod to conduct “limited banking activities”.

“It is hereby notified that Time Bank of Zimbabwe Limited has been authorised to conduct limited banking activities in terms of the Banking Act following a pre-opening inspection of the institution’s readiness to commence banking business,” RBZ said.

“Having regard to the institution’s risk management structures and processes, level of capitalisation, corporate governance arrangements, its business plan and the Banking Act, Time Bank has been authorised to conduct limited banking activities and shall not be taking deposits from the public,” the central bank added.

Time Bank came to the scene at a timed characterised by rapid changes to Zimbabwe’s banking sector in 1997.

It was part of a string of assets that were led by indigenous people who moved to capitalise on big opportunities that had been unlocked as Zimbabwe’s economy rebounded, underpinned by a strong agricultural sector and a robust manufacturing industry.

Trust Banking Corporation, Royal Bank, Kingdom Financial Holdings Limited, Highveld Financial Services and Interfin Banking Corporation were part of the crop that at the time challenged the status quo to build a financial services sector with flexibility to respond to industrial requirements.

But wheels came off in 2004, the year Time Bank collapsed, forcing the central bank to move in with tough corrective measures that resulted a sea of financial sector graveyards.

Gideon Gono, the former central bank governor, pooled the assets of a string of failed banks including Time Bank in 2006 to form Zimbabwe Allied Banking Group (ZABG), a $2 trillion financial institution.

ZABG also failed to stand the heat.

Time Bank’s closure was declared unlawful by the Administrative Court in 2009.

In 2015, the new governor of the reserve bank, John Mangudya, resolved the dispute between Time Bank and RBZ.

But its shareholders’ determination to return to the market became more pronounced last year when the bank announced its intention to relaunch.-newsday