Restructuring of POSB begins

Published: 10 June 2013

Restructuring of the People's Own Savings Bank has started, following the engagement of legal and financial advisors to facilitate the transaction, Parastatals and State Enterprises Minister Gorden Moyo has said.

Minister Moyo said in a statement last week that the restructuring of the POSB is meant to enable the State-owned bank to find a strategic partner to inject fresh capital.

Other State-owned firms targeted for restructuring include the Grain Marketing Board, National Railways of Zimbabwe, fixed-line phone company TelOne, mobile phone operator NetOne, Agribank, Ziscosteel, the National Oil Company of Zimbabwe, Zesa, Air Zimbabwe and beef producer Cold Storage Company.

POSB is a statutory body wholly owned by the Government. It was established through an Act of Parliament - the POSB Act Chapter 24:22 of 1999.

The bank is supervised by the Reserve Bank of Zimbabwe in terms of Section 45-52 of the Banking Act. The legal and financial advisers would assist Government in preparing information memoranda for use by investors, preparation of bid documents, identification and selection of winning bidder, the minister said.

The advisors will be working closely with the State Enterprises Restructuring Agency. A bidders' briefing conference for the financial advisers will be held on Wednesday this week at the POSB head office where a preliminary review of the bank would be presented.

The closing date for the bids for financial advisors is June 11, 2013.

The objectives of the restructuring include improving its capacity to underwrite more business to the productive sectors. Potential investors would inject fresh capital which would enable the bank to become one of the key financiers to the productive sectors, currently underfunded.

The restructuring would also assist the bank's viability to declare dividends to shareholders, including the Government, while corporate tax and other taxes payable to Government would increase the revenue base.

In addition, it is believed that restructuring POSB would spread economic opportunity to ordinary Zimbabweans, targeting the informal businesses and the marginalised in the remote areas, while capitalising on technology.

Furthermore, this enables the bank to partner with international development agencies in further developing POSB's capacity to widen the frontiers of financial inclusion.

The restructuring would allow POSB to mobilise deposits and savings from the formal and informal markets and avail the resources for productive on-lending, to provide a secure and reliable suite of micro-banking products and access expertise and technology from the strategic partner to improve the banking operations.

Minister Moyo said that POSB would still retain its original mandate of deposit and saving mobilisation as provided for in its Act.
- herald