ZB to double agric funding

ZB Financial Holdings says it is planning to double its agricultural funding this year and float $10 million worth of agro bills for the 2017 agricultural season.

Source: ZB to double agric funding – NewsDay Zimbabwe October 18, 2016

BY Victoria MTOMBA

The bank’s head of corporate services, Shadowsight Chiganze, told NewsDay yesterday that the support was meant to boost crop and livestock production.

“We are planning to raise $10 million through the agro bill floatation. We are unable to supply the split right now,” he said.

Chiganze said the financial institution is currently refining its customers’ funding requirements for the 2016/2017 agricultural season.

Agricultural funding has remained a challenge, as most farmers do not have collateral to enable them to borrow money from banks, while financial institutions are also reeling under bad debts.

Meanwhile, ZB Financial Holdings says it has not increased the amount of loans in the special purpose vehicle.

“We are yet to secure investors for the SPV, as we are in the final stages of valuation of the loans that are being sold under the SPV,” Chiganze said.

The group created an internal SPV to house $14 million of the group’s bad debts that failed to qualify for an uptake by the Zimbabwe Asset Management Company (Zamco).

The SPV is autonomous and will have an independent board, administration structure and a lot of support will be rendered by the group so that no costs will be incurred.

Chiganze said as at December 2014, the group’s NPL’s stood at $49 million, in June 2015 they received $13 million from Zamco, and they wrote off $11 million and remains with balance of $24 million. For the first six months of this year, the group received $4,6 million from Zamco.

Zamco is a SPV created by the Reserve Bank of Zimbabwe in 2014 to clear the balance sheets of banks, NPLs and enable them to lend again to sectors of the economy. So far, over $450 million has been taken over by Zamco.