Zimbabwe’s Largest Bank to Sell Bonds Worth $200M in 2014
Written by Godfrey Marawanyika and Brian Latham | From Bloomberg
CBZ Holdings Ltd., Zimbabwe’s biggest bank, will sell $200 million of bonds backed by Africa Export Import Bank, CBZ Chief Executive Officer Never Nyemudzo said.
Afreximbank will underwrite the debt, which will pay a coupon of 7 percent, Nyemudzo said in an interview in Zimbabwe’s capital Harare on Aug. 14.
“We’re going to conclude that bond definitely this year,” he said. “We have a number of projects in the pipeline from infrastructure to mining and food processing.”
CBZ, also Zimbabwe’s biggest locally controlled lender, acted as the government’s banker after the country’s economy spun into economic recession and hyperinflation during the last decade. That responsibility has now returned to the central bank, Nyemudzo said.
“The move didn’t cause any material negative impact,” Nyemudzo said. “The government gave us ample time in order to plan moving their exchequer account back to the central bank, so when it happened we were well prepared.”
CBZ, which saw first half profit dip to $12.8 million through June, partly weighed down by non-performing loans, says the number of bad loans is manageable.
“It’s 6 percent of our book, well within our 8 percent mark and nothing to worry about given our level of capital as well,” Nyemudzo said.
Read more at Bloomberg