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Charles Chikaura

ZIMBABWE’S infrastructure bank has returned to solvency after the Reserve Bank of Zimbabwe’s special purpose vehicle warehoused the bank’s non-performing loans, boosting the bank’s capacity to develop housing projects portfolio, chief executive officer Charles Chikaura has said.

Chikaura told delegates attending the launch of the bank’s home saver account last Thursday that IDBZ intends to build 30,000 housing units between 2014 and 2018, a development he said would ease pressure on the national housing demand, currently standing at 1.25 million.

Last year, the central bank set up the Zimbabwe Asset Management Corporation (Zamco), a special purpose vehicle to purchase non-performing loans from banks and clean their balance sheets.

“The debt take-over through Zamco has immensely strengthened the bank’s balance sheet which is now solvent with a positive equity position of $33 million, way above the minimum regulatory capital of $25 million for the low tier category of banks under the Reserve Bank’s capital adequacy bands, thus enhancing the bank’s capacity to mobilise resources for infrastructure development from both domestic and offshore sources,” Chikaura said.

“The bank is therefore now able to do more with a clean, strong and quality balance sheet in terms of raising funding required for effective deployment into infrastructure projects including housing development.

“However, realising the limitations on the domestic capital market, the bank will be looking at options to raise funding from external sources, particularly the South African market and the Diaspora.”

The home saver account is designed to help Zimbabweans to save towards the purchase of a residential stand or house.

The account will not attract service and maintenance fees and will also be exempted on withholding tax on interest. — The Source.