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Business Reporter
Tetrad Holdings has strongly objected to the report issued by Mr Winsley Militala, its provisional Judicial Manager which recommended its liquidation over the failure to attract investment and also questioned the banking group’s corporate governance record. In a Press statement, the Tetrad Board questioned the qualifications, competence and partiality of Mr Militala in the discharge of his duties on behalf of the members and creditors of the Bank.

“The members of the Board of Tetrad Holdings representing the shareholders, together with the previous management and directors of the bank object in the strongest terms the content, accuracy and conclusion of the report,” the board said.

According to the board, material contained in the report and comments made by Mr Militala were based on unsupported evidence regarding the alleged behaviour and conduct of members, management and directors of the bank.

Tetrad said it was encouraging members and creditors to contest recommendations passed and to consider whether Mr Militala’s continued appointment was in their interest at the second creditors meeting to be held tomorrow.

Mr Militala is recommending the liquidation of the bank, while the board still believe they can secure an investor to save the bank from collapsing.

The board maintains that negotiations with investor, Horizon Capital are still on despite there being no conclusion yet.

“The deal according to the members and a local representative is still on the cards though no date of conclusion has been intimated,” they said.

The board says Mr Militala has not disclosed that he cancelled or failed to attend three meetings arranged with Horizon.

“He has been invited to physically inspect the financial instruments in Horizon possession that would provide the necessary injection of capital to enable the bank to survive.

“He has not done so and he has now indicated in writing that he is extremely reluctant to meet with any representative of Horizon.”

At the time the report was concluded, Tetrad was yet to meet with Horizon which had requested banking details.

“Despite implicitly recognising the existence, Mr Militala nonetheless considers it correct to recommend that the bank be placed on provisional liquidation on the specific grounds that there are no recapitalisation initiatives or any other forms of intervention that are currently being considered save for the Horizon transaction.

“The deal according to the members and a local representative is still on the cards though no date of conclusion has been intimated,” said the board in a statement.

In his report, Mr Militala said accumulated losses as at January 31 were at $54 million. Total liabilities exceed total assets by $26,3 million, indicating the existence of material uncertainty casting doubt on the bank’s going concern status. The bank has a negative core capital of $31,96 million, with return on equity at -37,4 percent.

Mr Militala said 99,21 percent ($62 million) of the loan book was non-performing. He said insider loans amounted to $32 million, from the $26 million that was reported by the central bank.

Mr Militala also expressed concern that the bank was having challenges keeping its records and books properly with a significant amount of manual calculation of interest on loans done by the bank.

He said two of the owner managers sit on almost all board committees with most non-executive directors having resigned.