BUSINESS REPORTER
Financial services concern GetBucks Microfinance Bank says it is seeking a full delisting of its securities on the Zimbabwe Stock Exchange (ZSE), a month after it announced plans to migrate to the foreign currency only bourse, Victoria Falls Stock Exchange.
“Further to the cautionary announcement dated 20 December 2022 advising of termination of the process of migration of the company’s listed securities from the Zimbabwe Stock Exchange to the Victoria Falls Stock Exchange shareholders are advised that the Company is now considering a full delisting of its securities on the ZSE,” the company said in a cautionary statement on Monday.
The planned exit comes as ZSE has also been losing counters, lured by the incentives offered by the VFEX. National Foods Holdings Limited lists on the VFEX tomorrow (Friday) after exiting from the local currency bourse.
GetBucks said the recapitalisation negotiations are still ongoing.
In the six months ended June 30, GetBucks had capital of ZWL$332m which was equivalent to US$1m but was below the minimum regulatory requirement of ZWL equivalent to US$5m.
“The full impact of the delisting and recapitalisation is still being determined and, if successful, may have a material effect on the price of the securities. Accordingly, shareholders are advised to continue exercising caution when dealing in the company’s securities,” GetBucks said.
GetBucks has been reeling from a rate hike by the central bank which has seen income dropping. The central bank last year hiked the bank policy rate to 200% per annum from 80% as part of tight monetary measures to curb speculative borrowing.
GetBucks gets credit from banks for onlending to its clients such as government employees.
In the quarter ended September 30, GetBucks reported a 68% decline in total income to ZWL$200,359,210 from ZWL$635,296,606 in the prior comparative period.
“The increase in lending rates negatively affected the institution’s interest margin as the microfinance bank relies heavily on wholesale credit lines from commercial banks which hiked their lending rates to above 200% in compliance with the directive by the apex bank. As the majority of our clients are civil servants, we were not able to pass the increase in lending rates to them due to limits in their affordability,” GetBucks’ CFO, Wimbayi Chigumbu, said in a trading update for the quarter.
Consequently, GetBucks swung into a ZWL$194m loss from a ZWL$64m profit position in the same period last year.
“The loss is largely attributable to the increase in interest expense due to the policy changes. The microfinance bank reorganised its balance sheet and managed to dispose of certain assets and pay off loans from the commercial banks that gave rise to these losses,” Chigumbu said.
