HARARE: ZB HOLDINGS is in discussion with various councils throughout the country for land to venture into low-cost housing, an executive has said.
Banks are venturing into property development to raise additional income due to the subdued economic performance which has constrained banks to get the bulk of their income from interest on loans. ZB Holdings chief executive officer Ronald Mutandagayi said the company would focus on property going forward.
“We are mobilising land banks in the country and we are speaking with various councils. The councils include Bulawayo, Harare and Victoria Falls and will focus on low-cost housing,” Mutandagayi said.
He said the group does not require huge sums of money for the development of the land banks, but would have arrangements with councils. “We can structure the terms we have payment arrangement with councils,” he said.
Mutandagayi said the group was also consolidating Victoria Falls despite tenants’ voids being an area of concern. Mutandagayi said the group has 10 units that are at the selling stage in Twentydales, Hatfield. The group is completing 100 stands at Springvale in Ruwa along the Harare-Mutare Road, he said, adding the group was also working on 150 stands in Beitbridge.
Mutandagayi said the group planned to vacate the Rotten Row offices and get new tenants to increase the asset base of the company.
He said they were also waiting for regulatory approval for the merger of their two units — ZB Bank and ZB Building Society — a move that would help the merged entity to meet the $100 million minimum equity capital threshold required by the Reserve Bank by 2020.
The company is still searching for a technical partner to boost its capital. Mutandagayi said last month that the group did not have the lee-way to raise capital like its competitors and the profit that they were making might not make the company reach the $100 million required in five years.
For the half year ended June 30 2015, the group recorded a profit of $4,1 million compared to a loss of $1,2 million during the same period last year, attributed to a raft of cost-cutting measures which include closing loss-making entities.
