Allied Bank finally shuts doors

The Reserve Bank of Zimbabwe on Thursday announced that it had cancelled Allied Bank’s operating licence after determining that the financial institution was no longer in a safe a sound condition.

“The cancellation followed a voluntary surrender of the licence by the banking institution,” the apex bank said.

“The Reserve Bank has determined that the banking institution is no longer in a safe and sound condition in that the institution is grossly undercapitalised and is facing chronic liquidity challenges.”

Transport Minister Obert Mpofu is the majority shareholder in Allied Bank, which emerged from the ashes of the Zimbabwe Amalgamated Banking Group – which was created by the central bank in 2004 to warehouse the assets of three troubled banks.

Allied is one of the seven financial institutions that were placed under increased central bank monitoring in 2014 as its core capital position weakened.

“The Reserve Bank will accordingly hereafter, apply for the liquidation of the institution in terms of section 57(1) (a) of the Banking Act. This action was considered to be in the best interests of the banking institution, its depositors and creditors, and the banking sector in general,” the Reserve Bank said. – The Source