The National Pension Scheme Authority (NAPSA) has effectively taken control of Zambia Industrial Commercial Bank – ZICB by increasing its equity stake from 16% to 65%.
ZICB is a product of the restructuring of the former Intermarket Banking Corporation Zambia Limited, which the Bank of Zambia took possession of in November 2016, with the then Bank of Zambia Governor Dr. Denny Kalyalya confirming that the central bank had managed to save the bank from total collapse.
Bank of Zambia in October 2018 confirmed that they “managed to secure agreements with the majority of the large corporate depositors, i.e. National Pension Scheme Authority (NAPSA), the Madison Group and the Workers Compensation Fund Control Board to convert their deposit liabilities into equity while the Industrial Development Corporation (IDC) came on board to participate in the process to ensure solvency.
According to information made available to the Zambian Business Times-ZBT, NAPSA Director General Yollard Kachinda said NAPSA has increased its stake following participation in a Rights Issue at a nominal price of K1 per share and upon obtaining the requisite regulatory approvals. The capital raised by ZICB through this transaction would strengthen its capital position and improve its cash flows.
“As a result of this transaction, NAPSA through its Special Purpose Vehicle, NAPSA Investments Holdings Company Limited has increased its stake in ZICB from 15.83% to 63%.
Kachinda said this capital injection was aimed at building capacity for market competitiveness, achieving operational efficiencies and realigning the strategic direction of the bank to facilitate growth in the Small and Medium Enterprises (SME) sector in the country, which has remained untapped.
“We are pleased to be part of the transformation of ZICB through this capital injection,” The Napsa Director General said.
ZICB was set up as a specialty bank to fund industrialization of Zambia but stakeholders say the bank is yet to show how this would be done significantly. Funding for local industries and local business still remain a challenge in Zambia. More information to follow…
