RBZ said this action was considered necessary in order to protect the public while the bank implements a scheme of arrangement with creditors that has now been extended to January next year putting on hold payment of its creditors.
In a statement, RBZ said the scheme of arrangement was against the background of the bank’s persistent failure to honour maturing liabilities, including depositors’ funds.
“Further, take notice that the register of banking institution has, with immediate effect suspended Tetrad Investment Bank Limited’s banking activities pertaining to deposit taking and issuing of loans in terms of section 48 (1) (f) of the banking Act (Chapter 24 v20) and this suspension remain for the duration of the Scheme of arrangement,” said RBZ.
Tetrad Bank entered into a scheme of arrangement with its creditors which was sanctioned by the High Court on September 24 and will run up to January 31, 2015.
The group is currently in discussions with Horizons Capital Consortium Holdings for an equity transaction although the consortium is said to have requested more time to complete its obligations under the agreement.
However, Tetrad said it had, since 2013, been in talks with Finance Bank of Zambia and although the negotiations lapsed following the talks with HCCH, they had since been revived.
“FBZ has since commissioned the revision and updating of a previous due diligence report, which process has been completed by Deloitte (Zambia),” said chairperson of the scheme Justice George Smith.
FBZ, in October, wrote to the RBZ confirming its interest in discussions with Tetrad for the acquisition of an equity stake in the bank.