RBZ reviews Meikles TBs

HARARE - The Reserve Bank of Zimbabwe (RBZ) has reviewed terms and conditions of the $49,6 million Treasury Bills (TBs) issued to Meikles Limited (Meikles) to make them attractive on the market.

The TBs had been issued to settle a $90,8 million debt owed to Meikles since 1998.

John Moxon, Meikles chairman, yesterday said government had “agreed to revise some properties of the white paper”, adding that the group “was already discussing with international financial institutions to buy the TBs”.

This comes as the Zimbabwe Stock Exchange-listed diversified group has been struggling to liquidate the TBs due to their unattractive interest of two percent.

Moxon, however, said considering the new features to be prescribed on the TBs, the group “will probably settle for international buyers” although it is in talks with various local financial institutions.

He, however, could not give details of the reviewed terms.

Market analysts say it will be difficult to secure buyers for the paper due to prevailing liquidity challenges.

Among the issued Bills, the first batch of $17,6 million will mature in three years, the second lot of $16 million in four years and the last lot of another $16 million in five years — all at two percent interest.

The central bank has indicated that it issued a total $406 million TBs since the beginning of the year, with the bulk of the government paper pertaining to the RBZ debt takeover programme by Treasury.

John Mangudya, RBZ governor, said “government has been able to settle all TBs ($213,13 million since 2013) timeously on maturity including capital and interest on Treasury Bills that were issued in 2012 in lieu of statutory reserves”.

Some of the Treasury Bills issued by the RBZ went towards clearing FCA and tobacco retention balances.

Meanwhile, Moxon said the group’s supermarket division registered one percent growth in the six months to September.

“We are very pleased with TM Supermarkets and the retailer is now very well placed to record profit in the long term,” he said.

Phil Ellis, Meikles Mega Market chief executive, said the new addition to the group was growing phenomenally at between 10 and 12 percent month-on-month.

“We are currently on an expansion programme and we are taking commodities to the people at affordable prices,” he said.

“We want to expand our operations into all cities and towns across the country where the people are. This might take time but we are looking at opening eight branches by year-end,” added Ellis.

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