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Harare Bureau
STEWARD Bank chief executive officer, Kwanele Ngwenya, has been forced out of the banking institution following the bank’s poor performance and issues relating to non performing loans.

Sources at the institution say Ngwenya met his fate after the bank’s board of directors met and refused to renew his contract in light of corporate governance grey areas.

Ironically, Ngwenya’s contract was due to expire at the end of this month.

The sources said the board was not amused with the bank’s bad book and the level of non-performing loans at the bank.

In a statement the bank’s board of directors announced the departure of Ngwenya without giving reasons for the collapse of the two year marriage.

“Ngwenya will step down from his position at the expiry of his contract on January 31, 2015. We are grateful for Ngwenya’s leadership during his tenure as chief executive officer, during which he oversaw Steward Bank’s successful rebranding and transformation into one of the country’s leading banks,” said the board in a statement.

The Board will appoint an executive in an acting capacity pending the appointment of a substantive chief executive.

“Ngwenya’s departure was eminent as there were corporate governance issues concerns over the loan book and conflict between him and the management at Econet Wireless, the parent company. There was also conspiracy against Ngwenya within the group,” said a source.

Steward Bank, a subsidiary of Econet Wireless posted a $3,7 million loss in the six months to August last year due to high costs incurred during business re-alignment.

The loss was, however, an improvement from $22 million recorded in the same period last year.

The re-alignment costs included staff retrenchment and the impairment of property and equipment as a result of the closure of marginal bank branches. Net income increased to $2,3 million from $2 million a year earlier due to higher margins on lending. Similarly, non-interest income rose to $7,75 million from $3,9 million on increased transaction fees.

The bank’s total assets grew by 31 percent to $181,7 million from $138,7 million as at February 28 last year.

Total deposits grew 63 percent to $100 million.

The bank’s core capital stood at $51 million, double the current prescribed minimum capital level of $25 million for tier one banks. The Reserve Bank of Zimbabwe requires Tier one banks to have minimum capital of $100 million.