January 28, 2009
By Greatman Moyo
HARARE - Norman Mataruka, the Reserve Bank of Zimbabwe (RBZ)'s bank licensing, supervision and surveillance chief, has been exposed for his and the entire institution's duplicity, amid reports of his near 20 percent stake in NDH Bank Limited (NDH Ltd) - against standing bank regulation and general corporate governance rules.Mataruka, who has emerged a key associate and enforcer of central bank governor Gideon Gono, sank many "an institution" in the tumultuous 2003-2004 period over what they called "irresponsible banking and unbalanced institutions" caused by weak governance, and monitoring structures.However, news of the senior RBZ staffer's shareholding in an operational Zimbabwean bank has invoked serious questions about conflict of interest issues and how muddled, and selective Gono's bank regulation policy is.Industry sources told The Zimbabwean Times that Mataruka "sneakily licensed" the fledgling financial institution because of his interest in the NDH Holdings Limited subsidiary early last year."He has an effective 20 percent stake held through various investment vehicles and to cover his tracks (on obvious bias and his surreptitious agenda) Mataruka licensed NDH just about the same time he okayed Tawanda Nyambirai's TN Bank project," said an irate banker.To compound matters, Mataruka's younger cousin Leo - a former University of Zimbabwe economics lecturer who now describes himself as a business consultant - is managing director of the Harare bank, operating out of MIPF House in Central Avenue.It was not immediately clear whether the Mataruka cousins held their NDH holding-company equity separately or through a single special purpose vehicle.Norman Mataruka, known for his cavalier attitude at the height of bank failures and great financial ruin to many Zimbabweans, has been dubbed a "thorough-bred version" of the amoral RBZ hierarchy, due to his "acerbic tongue and strong-arm actions" one alleged, if not phantom financial offenders or wrongdoers, when the bank itself was mainly at the centre, and forefront of dodgy deals and arrangements."This man typified or exemplified Gono's delinquent understanding, and management of the financial sector. When confronting bank owners and executives on alleged incestuous transactions, which culminated in arbitrary arrests, harassment and humiliation you could see that he carried his business with a cue from his boss," said the source.So close were the two men - and government functionary's relationship - that, mid 2005, Gono managed to "talk Mataruka out of his early and voluntary retirement" plan from the cushy RBZ job in the aftermath of the much-maligned "financial reforms", through a complex remuneration structure executed outside the RBZ.While Mataruka's "equity participation" in the privately-held NDH came long after the "clean-up" debacle or fallout - aimed at ridding the industry of bad apples - it was not clear whether he had declared such an investment, especially in keeping with mandatory public office bearers' responsibility, norms and laws in a sensitive sector like the financial services.Still, such a proclamation would not suffice because Zimbabwe's Banking Act expressly discourages and prohibits RBZ officials from owning shares in allied businesses, which are subject to their routine scrutiny or checks for fear of subjective views on appraisals and other operational issues.Among those banks culled or said to have been plagued by poor to non-existent oversight structures and mechanisms were Barbican Bank, ENG Capital, Guardian Asset Management, Nicholas Ingrain's Aftermarket Banking Corporation, Rapid Financial Holdings, Royal, Sagit Finance House, Trust Banking Corporation and a host of other small institutions such as asset management companies.Although Gono and his main bank lieutenants have maintained a "moral high ground", we can exclusively reveal that he once held a four percent stake in NDH Ltd - among many other banking portfolios - prior to his RBZ crossover and the shake out he orchestrated five years ago.Along with other prominent bankers and politicians, notably Trust founder William Nyemba and Rural Housing minister Emmerson Mnangagwa, this stake was held directly and during his tenure as CBZ Bank Limited chief executive, and amid a culture of convoluted inter-bank cross shareholdings marking the hubris and greed that he was to try and contain through self-serving monetary reforms.In fact, it was further suggested this week that the former Zimbabwean parliamentary speaker and Zanu PF politburo member, Mnangagwa, enjoyed "several occasional and mainly-Friday afternoon lunches" hosted by veteran banker, and NDH founding chief executive Ernest Matienga at his offices. In tow - and central to those meetings or get-togethers - were the bank's now exiled, and deposed former executive directors Jabulani Manyanga as well as Zimbabwe Allied Banking Group supremo Never Mhlanga.Today, it is not clear whether Gono and his political handlers - notably president Robert Mugabe's would-be successor Mnangagwa - have disposed off their NDH stock.Observers said this scenario of co-investment by State and Zanu PF heavy-hitters could explain why a "hurtling NDH" was saved from collapse in the 2004-2005 period.Once a highly profitable and top performing business, owing to its securities wing or division's exploits, NDH escaped the fate of several and similar indigenous-owned firms through an elaborate, and protracted depositor/creditor re-investment scheme drawn up, and implemented by leading commercial lawyer Edwin Manikai, a Mnangagwa acolyte. Mnangagwa, Manikai and Manyanga's co-operation, and NDH history are well documented, especially over the ruling party's business and financial affairs.The NDH rescue programme and process, meanwhile, was also okayed and overseen by Gono, and his trusted "licensing and supervision" chief Mataruka.However, cracks seem to be emerging from the cabal and alliance amid revelations that the latter has been badmouthing his RBZ boss over allegations that he was "merely a pawn in Gono's power play and would soon blow the cover of the governor's corrupt ways"."In a true self-cleansing act and posture of the aggrieved, Mataruka has been disparaging about Gono in certain private quarters, especially in the wake of recent theatrical television dismissals of bank executives" said the informer.Particularly, this has been happening after the recent bank crises engulfing our financial services sector, where accusations (and counter arguments) of indolence have been flying," he added, observing the "apparent cat-fights" were least surprising given the monetary authorities' legacy of being double-faced when swamped by challenges.