|Genesis depositors to get compensation|
|Wednesday, 13 June 2012 21:03|
THE Deposit Protection Board says it is working on modalities to compensate depositors of the closed Genesis Investment Bank. Genesis Bank on Monday voluntarily surrendered its banking licence to the Reserve Bank of Zimbabwe after failing to raise capital.
DPB chief executive officer Mr John Chikura said the board was working on compensating depositors, but would not give details.
“We are coming in,” he said. “Everything will be communicated through notices in terms of the procedures that would be taken to compensate depositors.”
The board’s primary objective is to provide deposit insurance to depositors in registered deposit-taking institutions.
The fund offers limited coverage and guarantees that small depositors will be paid in full up to the insured amount in the event of bank failure.
Currently, the prescribed maximum deposit compensation covers in full 90 percent of all depositors’ operating accounts in contributory institutions.
The central bank said it had also started proceedings for liquidation after the bank failed to meet minimum capital requirements.
Genesis failed to attract investment from 20 possible investors they have courted since 2009.
Meanwhile, the Deposit Protection Board says depositors in Interfin Bank, placed under curatorship, are safe as the curator had moved in to protect depositors and creditors.
Mr Chikura said curatorship was meant to show that the bank was in “intensive care” and the curator would resuscitate it.
Interfin was placed under curatorship by the central bank on Monday for a period of six months after facing insurmountable liquidity challenges.
Interfin has been failing to pay demand deposits since January this year due to liquidity problems.
The entire market faced cash challenges in December last year spilling into January this year from which Interfin never recovered.
Mr Peter Bailey of KPMG has been appointed curator for the six months.
“Interfin has been facing problems but depositors are safe because the bank has been placed under curatorship to stop it from bleeding in the interest of depositors and creditors,” said Mr Chikura.
Analysts yesterday commended the regulator for intervening in weak and undercapitalised banks.