The Sunday News
Business Correspondent
CBZ Bank Limited has poured US$8 million towards the construction of 1 095 houses in Gweru Nehosho area, a top company official has said.
Briefing analysts during the company’s Annual General Meeting (AGM) in Harare, CBZ incoming chief executive officer Mr Never Nyemudzo hinted that the company had started constructing houses in the Gweru high density suburb where 1 095 stands are to be developed.
“During the quarter we have started the first phase of our Gweru, Nehosho high density suburbs project, where we are seeking to develop 1 095 stands. The cost of doing this project is approximately $8 million.
“The process will take a few months, after which the second phase which involves construction of core houses will begin. Our maiden bond, the $68 million progressed very well, we have retired the maturity, the $68 million two weeks back, and now we are at an advanced stage to raise the renewal at a higher level of $200 million,” said Mr Nyemudzo.
The bond will be guaranteed by Afreximbank and is anticipated to have a coupon rate of around seven percent based on the successes of the first bond which had an 8,5 percent coupon rate.
Meanwhile, the group is enjoying significant capital buffers with the bank sitting on a cash pile of $161 million against the $25 million threshold required by the central bank.
Mr Nyemudzo said: “The first quarter was largely characterised by liquidity challenges which have increased the cost of doing business primarily, coming out of increased cost of funds in the bank. “As a result we are seeing pressure on customers to meet their obligations on time.
In response we are going to continue to strengthen our customer relationships, enhance collection efforts on all overdue debts and our effort in expanding long term deposits.”
