BancABC mired in Chatunga loan storm

PRESIDENT Robert Mugabe’s son Bellarmine Chatunga indeed approached BancABC in the company of his bodyguards despite a deliberate denial by the financial institution, insiders told the Zimbabwe Independent.

chatunga

Following a report by the Independent that Mugabe’s son had approached the bank seeking a US$380 000 loan, BancABC went into overdrive in a desperate effort to discredit the story due to political pressure.

In a bid to get the bank’s side of the story before publication, the newspaper fulfilled all the dictates of professional journalism.

Chatunga’s failure to secure a loan from BancABC is a rare example of prudent credit risk assessment by a local bank as most of them would be keen to lend to such a high-profile and well-connected individual — even if he is a teenager — as he comes from the First Family which can potentially offer political protection in times of trouble.

While banks are supposed to conduct risk assessments on their clients whatever their station in life, in Zimbabwe the well-connected always secure loans even if they do not have adequate or quality collateral, sometimes entirely without security.

This has contributed to non-performing loans (NPLs) which two years ago scaled over US$700 million before the Zimbabwe Asset Management Corporation (Zamco), a special purpose vehicle set up by government to clean up the balance sheets of financial institutions, was established. As at December 2015, Zamco had acquired NPLs amounting to US$357 million.

Senior bank managers told this paper that on the day in question, Chatunga, who was in the company of three aides when he approached the bank, met BancABC staffer Lincoln Chirinda as reported in this paper.

The banking sources said Chirinda, who was on leave, was summoned to the office for a meeting by the bank’s managing director Joe Sibanda after the story was published.

“The President’s son indeed approached the bank seeking a loan in August. The bank is trying to manage its image following publication of the report,” an insider said.

This paper made several calls to Sibanda and sent an SMS seeking comment ahead of publication deadline. The bank only responded to the report through a fire-fighting press release which came six days after publication.

The bank also desperately engaged a public relations agency, Magna Carta, after publication of the story on September 30 in an effort to solicit a detailed question-and-answer interview with the author of the story before resolving to flight press releases via the state-controlled media.

After the release of the press statement, PR consultants for the bank continued to pester the reporter for an informal behind-the-scenes meeting. – ZimInd

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