By Staff Reporter
TIME Bank of Zimbabwe Limited (Time Bank) has tabled a syndicated US$35 billion economic rescue aimed at compensating displaced farmers, both black and white in Zimbabwe’s pre and post-2000’s land reforms.
The bank which was shut down by the Reserve Bank of Zimbabwe in 2004 before resuming operations in 2022 says it will create a venture capital fund (VCF), social welfare system funding and help government’s debt resolution strategies.
While the financial institution has identified up to 10 local groups who require urgent compensation, the bank has also emphasised that its homegrown and multi-faceted plan would not require public borrowings from the Reserve Bank of Zimbabwe (RBZ), as it was based on private and global capital funding.
“Time Bank has proposed to arrange syndicate loans of US$35 billion… for the purpose of financing… the compensation of 10 groups, including previous farm owners (PFOs) at US$ 3,5 billion (from the state) and US$3,2 billion (from donors), first group of indigenous farmers at US$7 billion (all under section 295 of the constitution) and refinancing foreign lenders at US$20,4 billion,” company managing director Christopher Tande said in a statement accompanying the reopened lender’s results, adding the statement of intent “did not mean the envisaged amount of US$35 billion was sitting on its balance sheet, as it was going to use its organisational capacity to arrange such facilities, appropriate banking and non-inflationary solutions for the benefit of the country”.
“Other amounts are earmarked for the social welfare fund (SWF) at US$2 billion, VCF at US$1,5 billion and financial inclusion fund at US$3,5 billion, pre-2009 bank depositors at US$1,1 billion, pensioners due for an almost similar amount, insurance policy holders at US$400 million, ex-farm workers, displaced new and resettled farmers at nearly half a billion as well for improvements made on allocated land, and bilateral investment promotion investors at US$400 million (hence the composite figure of nearly US$40 billion),” he said.
Tande said the “loans will be done in three phases of mobilising up to US$1 million to purchase treasury bills (TBs) from PFOs under the pilot scheme, and thereafter leverage on the success of the first stage to raise more money to finance the hefty US$3,5 billion compensation bill for the same farmers and, then lastly, US$31,5 billion for the other groups”.
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While Time Bank remains aware of a second agreement outside the global compensation deed between Harare and former white commercial farmers, it was optimistic about the loan proposal’s approval based on the “fact that it could raise such monies without burdening the national fiscus”.
Meanwhile, the non-deposit taking bank has made an impassioned plea for the resolution of its US$20 million blocked funds claim, which it says could help shareholders in meeting its December 2024 plans to recapitalisation to the tune of US$30 million.
Its market interventions and proposals, including a desire to create a US$3,5 billion financial inclusion fund and revolving social welfare fund through value-added, and exportable Zimbabwean products was “driven by a hunger to see an improved business environment and policy regime capable of calming investors’ nerves by settling the old, and lingering issue of violated property rights”.
“Time Bank’s pilot scheme can be launched before government approval of the loan and the bank believes that a successful, modern economy needs both a free enterprise, and strong social welfare system to cater for… the vulnerable in society as well. With such an inclusive economy, it will be easier to establish a sustainable social contract, which can drive economic development,” Tande said, adding his revival plan would also ensure that Harare “borrows under structured instruments to cover beneficiaries from suffering heavy TB-discount losses on the resale market, deepen capital markets to a point of growing the economy – through such innovative facilities’ multiplier effect – to US$200 billion by 2044.”
