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Harare Bureau
THE Deposit Protection Corporation says it will immediately pay all Trust Bank, to be liquidated, depositors an amount not exceeding the maximum insurable limit of $1,7 million once the verification process is complete.
Depositors have already been advised to submit Deposit Insurance Claim forms so that compensation may be done timeously.
This follows the cancellation of the bank’s licence under Section 14 of the Banking Act by the Reserve bank of Zimbabwe in December last year over allegations of abuse of depositors’ funds and violation of provisions of the Banking Act.

In a statement released last week, DPC chief executive John Chikura said as the duly appointed provisional liquidator of Trust Bank he is empowered to reimburse depositors who were affected by the bank’s closure.

DPC are the administrators of the Deposit Protection Fund that was established under Section 13 of the Deposit Protection Act(Chapter 24:29) to compensate depositors in full or in part for losses incurred in the event of insolvency of a contributory institution.

The depositors with balances of less than $500 will be reimbursed in full while the remainder of the depositors’ owed large amounts will be paid through the liquidation process.

“Under its current, mandate, DPC will immediately upon verification pay all depositors up to the maximum insurable limit of $500 per depositor.

“We are looking at 3,452 depositors of which DPC has powers to compensate 90 percent of them.
“A public statement will be issued in due course to notify all depositors and creditors with balances above the insurable on the liquidation and date of the first meeting of creditors,” said DPC public relations manager Mr Allen Musadziruma.

Trust Bank was placed under provisional liquidation in terms of the High Court Order HC 10703/13 on December 18, 2013 issued by Justice Loice Matanda-Moyo. She ordered Trust Bank to provisionally wind up, paving way for liquidation.

Under the Deposit Protection Corporation Act Chapter 24:29, the DPC’s mandate has been expanded to involve the liquidation and curatorship of banks and the law enables them to look after the interests of the depositors under the Banking Act.

The central bank cancelled Trust Bank’s licence arguing that the financial institution was financially unsound while it also failed to operate in line with sound administrative and accounting practices.

Trust Bank suffered significantly due to a liquidity crunch which stemmed from a poor loan book, inadequate working capital coupled with abuse of depositors’ funds.