Historic bank merger stalled by board dissolution at CTC
LIVINGSTONE MARUFU
The absence of a board at the Competitions and Tariffs Commission (CTC) has delayed the merger of the country’s two biggest banks, CBZ Holdings Limited (CBZHL) and ZB Financial Holdings Limited (ZBFHL), which are expected to create the single largest financial services company in the country, it has been established.
The merger would be the biggest in the history of the country, and would make CBZ Holdings a behemoth, especially after its recent takeover of FML Holdings, the second largest insurance group in Zimbabwe with a diverse portfolio of subsidiaries.
As a result of the Dr Bennedict Moyo-chaired board’s dissolution in December 2023, which left CTC operating without a board for almost eight months, Business Times, a market leader in business, financial and economic reportage, can report that no decision could be made regarding the high profile CBZHL/ZBFHL deal, which has the potential to create a behemoth that could dominate Zimbabwe’s financial services sector.
Additionally, it is anticipated that the heavyweight will be more competitive in global markets.
Nonetheless, a new board was appointed two months ago, with Dr. Priscillah Mujuru serving as its chair.
CBZHL board chairman, Luxon Zembe told Business Times this week that Dr Mujuru board was now studying the regulations that govern the commission and potential decisions to make when faced with high profile cases such as the proposed CBZHL /ZBFHL merger.
“The challenge on the delay of the finalisation of the potential merger was that there was a new board which was instituted in August this year hence the members are learning about how the commission works and its regulations that govern. Then they start to deal with issues on the table for various companies. That is why it took so long as the board was dissolved in December 2023.
That is the biggest threat that we are facing at the moment. I think and believe that we should be able to get their final position before the end of the year,” Zembe told Business Times.
According to Zembe, if the proposed deal is cleared by CTC, it will dominate the local market and beyond.
“We are creating an institution that is Zimbabwean which has a potential to dominate the local market and beyond,” Zembe said.
Rumbidzai Jakanani, the chief governance officer of CBZH, warned investors and shareholders to use prudence when handling the company’s shares because the financial services firm was still in talks to acquire a complementary business.
“Further to the cautionary announcements issued on June 18 2022, July 21 2022, August 29 2022, September 27, 2022, November 14 2022, January 2023, March 2, 2023, April 6 2023, June 5 2023, and July 26 2024, the directors of CBZ Holdings Limited wish to advise all shareholders and the investing public that the company is still engaged in negotiations for a potential acquisition of complimentary business.
The acquisition, if successfully concluded, may have a material impact on the value of the company’s shares, the full impact of which is currently being determined. Accordingly, shareholders are advised to exercise caution when dealing in the company’s shares until a full announcement is made,” Jakanani said.
