Finance Minister Felix Mutati has assured the nation that Intermarket Banking Corporation will not be liquidated.
Presenting a ministerial statement in Parliament this afternoon, Mr Mutati revealed that Intermarket Banking Corporation is expected to resume operations in 30 days.
He said the bank has managed to attract fresh capital from new shareholders as part of its restructuring process.
Mr Mutati also explained that the issue of the name having the risk of scaring away customers is secondary as the new shareholders have already provided for adequate resources to take care of anticipated withdrawals once the bank reopens.
He said the possession of IBC by the Bank of Zambia was pursuant to Section 81 of the Banking and Financial Services Act which empowers the Central Bank to take possession of a financial service provider which is insolvent, unable to meet its financial obligations, and consequently posing a threat to financial systems stability.
“Following the possession of IBC, the Bank of Zambia as required by law prepared a Statement of Affairs of the Assets and Liabilities of IBC within 90 days and engaged the shareholders in order to explore modalities for the restoration of the bank’s solvency,” Mr Mutati said.
He added, “I am pleased to inform the House that the Bank of Zambia has accepted the proposal submitted by shareholders as providing a viable basis for a substantive restructuring of the bank which should lead to the resumption of its operations. Consequently, IBC is now taking steps to implement the restructuring plan as approved by the Bank of Zambia.”
Mr Mutati said during the restructuring period, the Bank of Zambia will closely monitor the activities of the bank and the public will be informed in due course regarding the timing of the resumption of its operations.
“In short, Mr. Speaker, the Bank is not going into liquidation but is being restructured so that it meets its obligations and consequently its capitalization requirements to continue its normal operations,” he said.