Zimpapers Logo

Business Reporter
THE board of Barclays Bank Zimbabwe (BBZ) says the sale of its local unit to First Merchant Bank of Malawi is subject to statutory regulation and approval by the Reserve Bank of Zimbabwe.

In June, Barclays Bank Plc (BBPlc), a British headquartered institution, announced that it was giving off about 57 percent shareholding in the local unit to First Merchant Bank of Malawi (FMB) as part of its continent-wide exit to focus on the European and American markets.

However, the move was disputed by a group of 63 BBZ low-level managers who lobbied the Government to block the bank’s sale arguing that the deal violates the country’s Indigenisation and Economic Empowerment Act.

The bank managers also demanded that BBPlc should have given a consortium led by BBZ managing director, Mr George Guvamatanga, the right to first refusal.

In a further cautionary statement on Friday, the BBZ board said shareholders and the public should exercise caution when dealing with the bank’s shares highlighting that the disposal of the local unit was not only limited to approval by the Reserve Bank of Zimbabwe.

It advised that there were also statutory and regulatory approvals that have to be adhered to in order to facilitate the transaction.

“BBPlc and FMB are in the process of fulfilling the conditions precedent to the transaction, which include, but are not limited to, approval by the Reserve Bank of Zimbabwe.

“Shareholders and the public are therefore advised that the transaction is subject to statutory, regulatory and other approvals and, as such, they should continue to exercise caution and to consult their professional advisors when dealing in the shares of BBZ,” said the bank.

“In this light, details regarding the transaction will be made available in circulars of BBZ and FMB to be published in due course.”

Following the dispute regarding the transaction, legal experts have weighed in saying bank managers of the local unit have right to refusal but the matter is “complex”.

The Ministry of Youth, Indigenisation, and Economic Empowerment has said the Government was seized with the matter and would announce its position soon.