We have created a new brand: Fungura

ZB Financial Holdings group CEO, Shepherd Fungura (SF) (pictured) was last week named the CEO Africa Roundtable chief executive of the year.

Business Times Deputy Editor, Phillimon Mhlanga (PM) caught up with Fungura in Victoria Falls to discuss the organisation’s restructuring programme, the corrective order issued by the Reserve Bank of Zimbabwe and the strategic focus, among many other issues.

Below are excerpts of the interview:


PM: Congratulations on being named the CEO Africa Roundtable CEO of the Year 2022. What does this mean?

SF: It’s quite an honour and privilege. I am CEO of the Year because of a great team, the ZB Financial Holdings family that I lead. I also want to thank my own family who have supported me.

To be voted CEO of the Year gives us a challenge that we must continue to do things that are better than we have done before. It’s an encouragement for the future.


PM:  ZB posted strong financial results for the six months to June 30, 2022. How did you do that in a harsh economic environment?

SF: Our performance for mid-2022 to June 30 was mainly premised on the approach that we have taken as a business. One of them is to make sure that we serve our customers better than we were doing before.

We have also improved our technology platforms as well as our digital channels by which customers access us. So for that reason, we have seen an improvement in business transactions with our customers.

We are also on a transformation drive where we are trying to ensure that we create a one stop shop for our customers so that when they come wanting to do banking, we also offer them insurance and investment.

That has also made it easier for our customers. And they started increasing business with us.

So, to sum it all up, it was a business that increased because of the few aspects that we changed to the business.


PM: Take us through the organisational transformation that you embarked on?

SF: The organisational transformation was a programme that we created around November 2021.

We put in place projects that would change our business. These were meant to transform our business, first digitally. We wanted to improve our digital access that customers have with us.

We also wanted to improve our technology department as we operate our business. We also embarked on the business model transformation. So, we changed our business model.

Where units were working as separate businesses like the insurance business on its own, microfinance on its own, and others on their own, we then changed the business model to say let’s bring all these businesses together under one stop shop as an integrated financial services where when customers come to us they can access us from one point and not moving from one business to the other yet the businesses are related.

We also changed the manner in which we access our customers, mainly making sure that we provided options to say customers can access us physically if they want to through our branches which we have turned into what we call service centres or through what we call a national virtual service centre traditionally known as call centre or contact centre.

They can also contact us digitally using their phones in the comfort of their homes and also transact with us.

And, we also changed our branches into service centres where instead of a branch being just a bank branch, it’s now more than doing bank business.

It is now doing insurance and investment under one roof. And that itself, the transformation has made us ZB Financial Holdings you are seeing today.

And lastly, we then repositioned our brand. You will also notice that the brand image has also changed how ZB looks. We have put a smile on it because what we are aiming to do is we do whatever we do to benefit our customers primarily.

We want to make our customers happy and we are taking feedback from our customers more seriously.

So, at the centre of our DNA of our new brand, you are now seeing, we now want to create happiness in our staff to begin with because that’s the team we work with, our customers that bring business to us and also provide value to our shareholders and other stakeholders. So, that has been the transformation journey that we followed thus far.


PM: The RBZ issued a corrective order concerning the issues around governance, risk management, shareholding, compliance, among many other issues. What is the latest on the matter?

SF: The corrective order is in the process of being reviewed. We made submissions to the RBZ.  We fixed all of the issues save for the issue around shareholding which we have engaged the regulator, the RBZ. We do and are quite confident that should they come as we have requested them to have an inspection then we should have our corrective orders lifted shortly.

PM: What were the other concerns raised by the RBZ?

SF: Apart from shareholding the other issues raised were to do with compliance, issues of processes, issues controls, issues of risk management.

So, those have already been dealt with and we have put in frameworks and policies in place so that we are ready to comply, so that we have a sound trade environment.

There was also the issue of governance which they wanted us to fix and embrace best practices. Now, what we are waiting for is for them to come and do a review and see that we are now in the space they expect us to be. I am sure they will lift the corrective orders.


PM: You are currently running a cautionary statement on a potential acquisition of a block of securities on the business. May you shed more light on this?

SF:  Right now, what we have is an intention for an acquisition that we received formally, hence the cautionary that we have made.

The intention of the submission is that it will affect the price of shares of ZB Financial Holdings.

As of now it is just an intention, there is not much information, for which if we would speak it will be more of speculation at this point in time. That’s why we are running this cautionary, we just want investors to be just mindful of just what’s going on so that when they do take investment decisions, they do it wisely.


PM: Is that acquisition related to CBZ or what?

SF: That is what has been said for a long time and in the media as well. But, I think formally there has been an indication that one of the current shareholders intends to increase their block of shares and that’s what we are running cautionary on. Whether its CBZ or any other, we will see as more information is available.


PM: What are the risks that you consider the biggest threat to ZB Financial Holdings?

SF: I think as a business our key risks are around how we are managing our liquidity especially for the bank, how we are managing our credit risks for the bank as well and operational risks. When it comes to insurance business, just make sure that we run a balanced portfolio where we are able to pay claims.

The risk that we run if we are not to be able to meet our commitments. You will notice that financial services in general are about promising to act when an event happens.

Be it to pay that money to depositors when they want it, and for us to also collect from those we would have loaned money. Those are the kind of risks that we are managing.








PM: How are you surviving the liquidity crunch?

SF: I think we are swimming like everybody is doing, navigating the best where we can. And I think what we are doing is that we make sure we invest wisely, making sure that we have sufficient liquidity to meet claims, to meet any withdrawals our client might want to do and also to invest in a manner that we are able to preserve value.

So our investment strategy has been quite an important tool that we have used to manage liquidity crunch the best way we can.

We are also in touch with our regulator as much as we can. I am sure you that know in the banking space, there are also end of day engagements that we do with the RBZ about the money that we are holding with them or vice versa.

We also have interactions with bankers in the market. We have partnerships that we have and also we assist each other if we get into a situation where we need liquidity.


PM: What is your strategic focus (priorities)?

SF: We want to be able to serve our customers better than we have done before.

We also want to make sure all our customers come to us and do more business with us and do it seamlessly and the service we offer them is second to none.

We also want to make sure that we spread these across the jurisdictions that we do business in with a vision to spread ourselves beyond Zimbabwe.

I am sure you might have heard that we have already opened offices in Botswana, (reinsurance business is the first but we will expand our services). We also have intentions to explore possibilities of going into east and west Africa   as well. But, that will come in time.

We also want to continue to provide value to our stakeholders. Customers must have products and services   that meet their needs. Employees should be paid well, remunerated for their efforts to perform and deliver value. Board members should also receive competitive fees so they discharge their duties efficiently.

Shareholders want a return.  So, that’s what we are focusing on to make sure that the business itself is sound and sustainable.

And lastly, we are also running a programme called sustainable standard certification process where we are working on the regulatory with RBZ to standardize our way of doing business to ensure that we demonstrate that we are a sustainable business going into the future.

RBZ is working in conjunction with a European outfit to make sure that we get certification.

As ZB Financial Holdings, in total, we are a sustainable business that is able to impact the formal sector in the areas of investing green, in the areas of clean energy, and also we do clean water. Then we also have impactful projects that we do to build our nation.



PM: Is ZB Building Society on course to comply with the minimum capital requirement by December 31, 2022 deadline?

SF: Yes, it’s one of the things that we are working on. We have a variety of options to follow. One of them is to amalgamate our building society with the commercial bank that can give us immediate compliance to the minimum capital requirements. We also have an option to also surrender one of the licences and remain with one because the two outfits operate in the same market although with different products.

We also have the possibility of asking shareholders to also put money to close the gap that is existing. So, that’s what we are working with and we are getting to the tail end of concluding that.  But, I believe we will be able to comply by the December 31, 2022 deadline.


PM: Has the legacy issues pertaining to Nicholas Vingirai stake and others which have been holding up the proposed amalgamation of the building society and commercial bank have been dealt with?

SF: We are looking at the business values of any of the options and what shareholders are keen to follow. And Mr Vingirai is one shareholder like any other.

So, the total solution that will be brought to the table and that we will work with is one that shareholders will have supported, all of them and not just Mr Vingirai. So, I think that is the approach that we are taking. The legacy issues with Mr Vingirai are being dealt with separately with the business issues around compliance.



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