For ordinary people indigenisation is a lie
Nevanji Madanhire
What exactly does the proposed indigenisation of foreign banks mean to
ordinary people? A bank to the man on the street, in the circumstances
Zimbabwe finds itself in now, is a place where often-underpaid workers
withdraw their monthly salaries.
The bulk of salaried people are civil servants, who as we all know, are a
grossly underpaid lot, most of them taking home less than US$250. On payday
they go to their respective banks and withdraw the whole lot and wait
patiently for next month’s payday. The rest are the weekly wage earners in
our mines and factories who hardly need the services of a bank; just
collecting their pittances in brown envelops from the HR department.
For the few salaried employees, it doesn’t matter if the bank is
locally-owned or foreign. In fact, for most of them to call Barclays Bank
and Standard Bank foreign banks is wrong; they were born when the two were
probably the only banks in Zimbabwe. This means these banks are as
indigenous as they come.
For the ordinary people the distinction between local and foreign banks is
very thin because all the banks operating in Zimbabwe are run by black
locals. It is very rare now to come across a white managing director of a
bank. Any whites that are still connected with banks are probably all in the
board of directors; so from senior down to middle management, all banks are
run by black personnel meaning they have been adapted to indigenous
conditions.
What the ordinary people have known recently is that many black
businesspeople have established their own banks which have by and large been
very successful. But they also know that a number have been mismanaged and
have collapsed. They have also read in the newspapers that the old banks,
Barclays and Standard, have remained stable.
The conclusion they have come up with is that since both local and “foreign”
banks are run by their own black cousins but the latter are more stable, it
is the culture rather than the ownership that matters when one looks at the
soundness or lack of it in a bank.
A secondary but profound conclusion has been that the management culture in
the indigenous banks has not always been sound, hence a number have
collapsed. Given a chance therefore, they would bank any money they might
fall upon in the stable banks with a better management culture; it doesn’t
matter if the government minister responsible for indigenisation tells them
that the sound bank is owned by white imperialists domiciled somewhere in
London.
Their enemy, as far as their money is concerned, is not the white man in
London but the poor management culture at Mwendamberi’s bank!
Recently a bank owned by indigenous black businesspeople was put under what
is called “recuperative curatorship”, something that means nothing to the
ordinary salaried Zimbabwean who could not at the end of the month withdraw
his or her paltry salary. Being underpaid already, it must have been doubly
heart-breaking to be denied access to one’s earnings.
So for the average Zimbabwean, indigenisation of so-called foreign banks
means the introduction of a bad management culture in the banks previously
well run. The ordinary people begin to wonder why this is being done. Their
only conclusion is that there must be something in it for those leading the
crusade to “indigenise” the banks.
Banks are simply made up of depositors’ money as far as the man in the
street is concerned; so to him indigenisation means someone who otherwise
would not have honest access will now gain wrongful access to this money.
This is what exactly has happened with those indigenous banks that have
found themselves under curatorship or without licences. These banks have
seen their owners giving themselves loans that were not backed by
performance; in one documented case the parent of the major shareholder was
a beneficiary of a huge loan that he had no chance in heaven of ever being
able to pay back.
The troubled banks have also benefited from government deposits, which
deposits have also been abused. In a recent case, it has been reported that
the government has been prejudiced to the tune of US$17 million of
development money. If this money had been entrusted with the established
banks, which are now being labelled enemy banks, the money would probably be
safe and ready to be used for the purpose it had been raised.
The fact that proponents of indigenisation do not want to look at indigenous
bank mismanagement in the eye betrays their evil intentions regarding the
banks they are targeting. It is highly misleading of them to accuse these
banks of refusing to fund local businesses when they know they themselves
have created an environment that makes lending dangerous.
They accuse the banks of refusing to lend money to the farming sector when
literally no one knows who owns which farm. The so-called offer letter has
proved to be a counterfeit document which anyone can obtain from the nearest
land officer whose own credentials are also highly suspect.
Genuine businesspeople know when they can or cannot borrow money from a
bank; they know what a real bank requires when it lends money to individuals
or institutions. When they meet the requirements, they expect their bank to
treat them fairly and ethically as they meet their side of the bargain. They
know the same conditions apply inshore and offshore so they are not overly
worried by the ownership of the bank but by whether the banks is guided by
international best practice.
Interestingly, while some ministers are clamouring for the indigenisation of
banks, others are buying them. Recently a government minister bought a bank
for US$25 million — where he got the money is another story — but here we
get another model of bank indigenisation which all right-thinking people
would see as the better model. Indigenous businesspeople interested in
owning banks should seek funds and buy stakes in any bank they want; our
laws do not prohibit this, especially if the desired banks are trading on
the stock exchange.
Indigenisation has become a sensitive issue in Zimbabwe especially now when
it has been seen to benefit only a few individuals connected to a certain
system. To think that indigenisation can win anyone an election is to think
in an outdated manner when some Zimbabweans were fooled into believing that
grabbing from those who have guaranteed prosperity for the have-nots.