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RTG suspension on the Zimbabwe Stock Exchange to allow for thorough investigations into inter-company share deals.
Minister Biti was forced to cancel a Press conference on Thursday as he wanted to announce re-admission of the two counters on the bourse.
A Ministry of Finance official confirmed that the minister wanted to lift the suspension but the move was strongly opposed by the commission.
SEC chairperson, Mrs Willia Bonyongwe said “it was prudent as the regulator and advisor” to the Finance Ministry that thorough investigations be conducted.
“We felt that we did not have enough information to advise the lifting of suspension of Afre and RTG,” she said in an interview.
“We want to go through the documents and understand what was the nature of the transaction.”
In suspending Afre and RTG, Minister Biti said he had noted with concern notices from the two firms advising on issues that potentially breach sections of the Securities Act.
He said: “The ministry is concerned with the goings-on at Afre and RTG. Of late, we have seen fliers and notices of rights offers and EGMs, which in our view have the potential of breaching Section 85 of the Securities Act.”:
Minister Biti also directed the Commissioner of Insurance to investigate Afre subsidiaries – First Mutual Life, FMRE, Tristar and Pearl Properties (Private) Limited – in the wake of suspected irregular inter-company transactions at Afre and RTG.
Mrs Bonyongwe said the revelations of irregular share transactions on the stock market called for a major restructuring of the ZSE.
“It is an issue that we need to re-emphasise,” she said. “The restructuring of the ZSE will enable it to implement guidelines on corporate governance to maintain the credibility of the market.”
She recommended the appointment of an independent board, recruitment of staff with relevant skills, including a legal person and a compliance officer.
“If the ZSE had a compliance officer, then, they must have picked up the irregular share transaction in Afre and RTG,” she said.
Mrs Bonyongwe said SEC as the regulator, and the Zimbabwe Stock Exchange, needed to work hand in glove to create investors’ confidence.