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Former depositors and creditors of AfrAsia Bank, formerly Kingdom Bank, have to date received $4,84 million in compensation over two years after the bank was closed and put under liquidation.

The Reserve Bank of Zimbabwe (RBZ) cancelled AfrAsia’s license in February 2015 after the financial institution’s management surrendered it as they had failed to mobilise resources required to meet the minimum $25 million threshold for commercial banks.

The Deposit Protection Corporation (DPC), which was appointed the liquidator of the bank, said on Friday it had to date paid nearly $3 million to the bank’s creditors in two batches. “To date, two interim dividends amounting $2,95 million have been paid to preferent creditors,” said DPC chief executive, John Chikura.

“The third interim dividend is likely to be paid in the second half of 2017 to concurrent and unsecured creditors after all preferent dividends have been paid.” Mr Chikura said the dividends were being distributed “on a pro-rata basis depending on the rate of recovery and disposal of assets.

“Protracted legal proceedings and the illiquid market have continued to delay the anticipated timing of the liquidation dividends,” the DPC boss said.

The preferred creditors who have so far been paid include former employees, the National Social Security Authority, ZIMDEF and the Zimbabwe Revenue Authority.

Former depositors, who had $40 million locked up in the bank when it closed operations, had at the end of last year been paid $1,9 million from the Deposit Protection Fund (DPF).

Set up to protect depositors in cases of bank failure, the DPC currently pays a maximum of $1 000 per account after a bank is closed. Those with account balances of over $1 000 are only paid out after the liquidation process has been finalised. — New Ziana