Business Reporter
THE country’s sole banking sector workers group has petitioned the Competition and Tariff Commission (CTC) to urgently block the impending merger between the ZB Financial Holdings (ZBFH) and CBZ Bank.
The transaction was necessitated by CBZ Holdings acquisition of 37,79% stake in ZBFH from the National Social Security Authority (NSSA) in exchange for CBZ shares worth US$7,8 million.
Under the deal , NSSA recieved 14,341 million shares in CBZ, representing a 2,15% stake , while for the 50% cash transaction ,NSSA recieed US$11,6 million after factoring in the transaction costs.
In a bid to strengthen the deal, the new influential shareholder in ZBFH, CBZ Holdings has since commenced the merger of the two financial institutions and has since appointed Luxon Zembe acting chairman tasked to spearhead the process.
The developments have also seen former CBZ CEO Dr Blessing Mudavanhu and board chairman Marc Holtzman retiring in a huff.
While the new shareholder believes the merger will bolster efficiency, the Zimbabwe Banks and Allied Workers Union secretary general, Peter Mutasa this week wrote to the CTC expressing grave reservations.
“We write to express our staunch opposition to the proposed merger between ZB and CBZ and to strongly discourage its implementation due to the potential detrimental ramifications it may have on the banking sector and its employees.
“History has shown that mergers often lead to significant job losses as companies seek to streamline operations and eliminate redundancies.
“We strongly oppose any merger that may result in the loss of potential jobs for the bank employees.It is of utmost importance to protect the rights,livelihoods, and job security of these hard working individuals,” the letter reads in part.
The workers group contends that the merger could potentially create an environment of increased market concentrations, which would undoubtedly harm competition and limit consumer choice while in the process violating the spirit of fostering a diverse and competitive banking landscape that benefits both the consumers and and employees.
“We express deep concern that the merger may have adverse effects on customer services and accessibility ,particulaly in rural areas where financial inclusion is already a challenge.It is necessary to prioritise the availability, affordability of the banking services sector for all sectors of society, eve in the aftermath of any merger,” Mutasa said in the letter.
ZIBAWU also called upon the Reserve Bank of Zimbabwe (RBZ) to to thoroughly evaluate the merger and consider potential risks and improve negative consequences it causes .
They also challenged the central bank to safeguard laws, regulations and guidelines to safeguard the stability ,integrity and fairness of the banking sector , while protecting the interests of employees and consumers.
After careful determination of risks associated with the impending merger , the workers group strongly opposed the consolidation between ZB and CBZ and called upon the commission to reject the proposals and to discourage any further consideration of this “detrimental course of action”.
“We kindly request your full attention to our opposition and call for then protection of employees’ rights .The preservation of healthy competition , and the maintenance of accessible banking services.
“We eagerly await your response and anticipate the opportunity to engage in further discussions on this matter,” the letter added.
