Bob Diamond to help Harare issue bond

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Harare - Former Barclays chief Bob Diamond would help Zimbabwe tap much-needed international investment through a e150 million (R2.2 billion) eurobond, Finance Minister Patrick Chinamasa said on Wednesday.

Chinamasa said the banking mogul’s new group had promised to help lure back investors spooked by asset seizures and local ownership laws. “They promised they’re going to organise issuance of a European bond, of up to e150m.”

Diamond’s Africa-focused investment vehicle, Atlas Mara, recently paid $265m (R2.8 billion) for a 50 percent stake in regional lender BancABC, its first acquisition on the continent. BancABC has operations in Botswana, Tanzania, Mozambique, Zambia and Zimbabwe.

Atlas Mara’s investment in its Zimbabwe operations is expected to include $40m for shareholders and $40m towards operations in Zimbabwe.

Diamond quit as Barclays chief in 2012 after the bank was found guilty of manipulating a key inter-bank interest rate.

“We have many ideas and thoughts and are anxious to get going,” Diamond said. “The combination of Atlas Mara and BankABC will be… a significant benefit for jobs and economic growth.”

Chinamasa sought this week to assure Diamond – and the world – he had made a safe bet. “We welcome foreign direct investment and I want to assure you that we are a safe destination.”

Zimbabwe’s indigenisation law, which compels foreign firms to sell majority stakes to local partners, has scared off foreign investors.

Chinamasa said Atlas Mara was “free to choose local partners and also to decide and negotiate a price. They will submit their plan in due course to the ministry of indigenisation. What we are witnessing today is part of the effort to alleviate our liquidity challenges.”

The banking sector faces a cash crunch that has hampered economic growth. In December riots broke out at two banks that ran out of cash for depositors. - Sapa-AFP


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