The Bank of Zambia (BOZ) has with immediate effect taken possession of Commercial Capital Corporation Limited in accordance with section 81 of the banking and financial services Act, chapter 387 of the laws of Zambia.
In a statement released yesterday, Bank of Zambia Head of Public Relations Kanguya Mayondi said the Bank of Zambia has for some time now engaged shareholders and the board of directors of Commercial Capital Corporation Limited in order to resolve the deteriorating financial performance and condition of the institution.
He said that Commercial Capital Corporation had however, regrettably remained under-capitalized. He said the institution would continue conducting its business operations, but on a restricted basis under a manager appointed by the Bank of Zambia.
Mr Mayondi explained that during the period that the institution will be under possession, the central bank will cause to be prepared a statement of affairs and take any other action it deems fit.
He further stated that the decision by the Bank of Zambia to take possession of Commercial Capital Corporation Limited has been taken in order to provide for its orderly exit from the financial system.
[Q FM]
Good job BoZ.Who owns this bank? At least depositors will be protected.
This was formerly Union Bank now under Zambian shareholding- I think Dr. Mbita Chitala is one of them may be he resigned before it fell. I wonder what went wrong? Under capitalization? Strange… because when you have a financial Licence undercapitalization should be your least worry-its like you own a gold mine. This story may be incomplete.
BOZ showing some bite. That’s good. We need more details about what led to the under-capitalisation. Non-performing insider or related party loans? Fraud? Bad management practices? What? Who were the shareholders and why were they unable to pump in more capital? Who were the directors?