eBusiness Weekly
HARARE – The Depositor Protection Corporation (DPC) will conclude compensation payments for defunct financial services provider Royal Bank Limited.
As at the time of its closure circa 2012/2013, Royal Bank was heavily under-capitalised with a core capital of around $1,8 million, which significantly fell short of the minimum regulatory capital requirement of $12,5 million for commercial banks at the time.
DPC chief executive and liquidator John Chikura said compensation for the bank’s depositors was nearing its end in line with statutory requirements.
“Notice is hereby given concerning the impending termination of compensation from the Deposit Protection Fund to depositors of Royal Bank Limited by 31 July 2018,” he said.
Reads section 38 (50)(b) of the Deposit Protection Corporation Act (Chapter 24:29):
According to Chikura, claims that will not have been made by the July 31, 2018 deadline will be forfeited.
“A depositor has (a) up to 90 days from the date the Corporation gave written notice to the depositor of the appointment of the Corporation as the liquidator of the failed contributory institution, by mailing a copy of the notice to the depositor’s last known address appearing on the records of the failed contributory institution; or (b) 36 months from date of DPC’s appointment as liquidator of a failed contributory institution, whichever is the later date.”
Royal Bank was established in 1997 and placed under curatorship in 2004 after facing liquidity challenges, poor lending practices and corporate governance deficiencies.
The financial services firm’s assets were later transferred to Zimbabwe Allied Banking Group in 2005. After a myriad of litigations, the parties eventually settled for an out of court settlement and the bank was re-registered as a commercial bank in 2010.
