The liquidators of the Small and Medium Enterprise (SME) Bank and Zimbabwean minority shareholders are in for a two-month wait for a ruling in which the court will decide if the bank’s minority shareholders are liable for the bank’s closure in 2017.
High Court acting Judge Collins Parker reserved judgement yesterday after a virtual hearing, in which he is to make a finding whether Zimbabwean banker Enock Kamushinda, Metropolitan Bank of Zimbabwe Limited and World Eagle Investments are liable for the contracted debt, demise and liquidation of the SME Bank.
If found liable, the liquidators are seeking an order for Kamushinda and the two financial institutions to pay individually or jointly more than N$1 billion. In addition, they seek an order that will compel the minority shareholders Metropolitan Bank of Zimbabwe Limited and World Eagle Investments to pay an amount of N$121.4 million and N$20.2 million respectively for the outstanding payment on their shareholding.
The SME Bank is owned by the Namibian government, through the company Namibia Financing Trust with 65% of the shareholding, while the Metropolitan Bank of Zimbabwe is a 30% shareholder. Zimbabwean company World Eagle Investments (Pty) Limited has a stake of five percent.
The SME Bank was closed in 2017 after approximately N$200 million that the bank ‘invested’ with South African entities vanished into thin air. It is alleged that a lot of the SME Bank funds were deposited into Venda Building Society (VBS) Mutual Bank, a South African bank that is also now under curatorship.
The liquidators are claiming that between 11 October 2012 and 29 April 2015, an amount of N$97.1 million was transferred to South African recipients. Another transfer of N$53.5 million was transferred to South Africa between 30 April 2015 and 1 September 2015.
The bank again made a transfer totalling N$97.5 million to the South African recipients between 1 September 2015 and 17 January 2017. All these transactions were allegedly made at the time when Kamushinda was the deputy chairman of the SME Bank’s board.
Kamushinda claims that he and the two financial institutions cannot be held liable for the demise of the bank as the money, which was intended for SME Bank from the government, through the Namibia Financing Trust, never reached the institution.
They are further arguing that if Kamushinda were to be held liable then all board members including those who were serving on behalf of the government should be held accountable too.
The judgement will be delivered on 29 October.
For the hearing, lawyers Raymond Heathcote and Steve Rukoro represented the applicants and respondents respectively. – email@example.com