Zimbabwe's National Social Security Authority has taken an 84 percent controlling stake in Renaissance Merchant Bank, placed under curatorship last June by the Reserve Bank of Zimbabwe in response to irregularities and a US$16-million hole in its accounts.
The state-controlled Herald newspaper quoted Renaissance Bank Curator Reggie Saruchera as saying NSSA will inject US$10 million into Renaissance and convert to equity an earlier US$8.5 million loan to the bank that cannot be repaid in cash.
The Herald quoted Saruchera as saying the authority will move the bank out of curatorship within weeks and help it meet the minimum capital requirements set by the reserve bank. For a merchant bank that is US$10 million.
The NSSA deal caused a stir in parliament and the finance sector last June when it was made public. Critics charged that Finance Minister Tendai Biti had engineered the deal for the benefit of relatives in bank management. Biti dismissed those allegations.
Percy Mcijo, Matabeleland regional officer of the Zimbabwe Congress of Trade Unions, said the deal will not benefit retirees now drawing pensions of US$60 a month.
“NSSA should seriously consider giving workers housing loans and increasing pension benefits for retirees who are normally sidelined in such deals,” Mcijo said.
Economist Prosper Chitambara said the social security authority will reap the benefits of the deal when Renaissance eventually turns a profit.