Nedbank raises additional capital

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Harare (New Ziana)– Nedbank Zimbabwe has raised additional capital via a rights issue to meet the statutory minimum capitalisation threshold of US$30 million, the Reserve Bank of Zimbabwe (RBZ) has said.

In his monetary policy last week, RBZ governor Dr. John Mangudya said Nedbank, the National Building Society, and AFC Commercial Bank were among the banks that had failed to meet the 2021 capitalisation deadline.

At least 13 out of the 18 banking institutions in Zimbabwe, excluding POSB which has no minimum capital requirement, had complied with the statutory minimum limits according to their respective tiers.

Local banks had been given a deadline of end of last year to increase their capital base to remain strong and sound.

“Nedbank Zimbabwe Limited was non-compliant with the minimum capital requirement as at 31 December 2021. The Bank (RBZ) is pleased to advise the public that Nedbank Zimbabwe Limited has raised additional capital through a rights issue and is now compliant with the minimum capital requirement of ZW$ equivalent to USD30 million,” Mangudya said in a statement.

“Accordingly, Nedbank Zimbabwe’s reported minimum capital as at 9 February 2022 is ZW$ equivalent to USD31.1 million against the regulatory minimum of the ZW$ equivalent to USD30 million.”

The RBZ has already further extended to December 2022, the period within which non-compliant banks should meet the minimum capital thresholds.

An earlier deadline set for December 2020 had also been extended to December 2021, as the RBZ cited the need to protect local banks in light of the ongoing Covid-19 pandemic.

The development is expected to enhance the stability of the financial sector.

Tier 1 banks, which are large commercial and indigenous banks, are expected to have a minimum capital threshold of US$30 million or equivalent in local currency, while Tier 11 banks which include smaller banks, discount, and finance houses must have at least US$20 million.
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