tendai biti 2011.jpgFinance Minister Tendai Biti has tried to defend himself over his involvement in trying to bail out the embattled Renaissance Bank owned by his close associate, Patterson Timba, through the use of pensioners’ money.

 

During a question-and-answer session in the Lower House of Assembly, Biti was taken to task over his attempt to use his office and position to try and use public funds to bail out a colleague in the name of Patterson Timba.

 

Biti was quizzed even by legislators from his own party.

Biti was on the defensive and denied that his move was personal arguing that he was motivated by the desire to protect depositors’ funds.

“It is the duty of government to put in place measures that ensure depositors do not lose their funds like what used to happen in the past…This bank is not a mickey-mouse bank as it holds over 60 million of depositors money. We need to restore confidence in this sector…,” he said.

Despite Minister Biti’s admittance that mismanagement has been the result of the collapse of the bank, it is the rescue method by government that observers say could set a bad precedence to other financial players as they might deliberately mishandle depositors’ funds knowing they can still be bailed out by government.

The connection between Minister Biti and Patterson Timba, who is also brother to MDC-T Minister, Jameson Timba, has set tongues wagging.

 

Previously, the Reserve Bank of Zimbabwe used to use the Deposit Protection Corporation Bill to close troubled financial institutions and put them under curatorship.

Currently, the bill is before parliament for the consideration of repelling clauses that gave the Reserve Bank of Zimbabwe such powers in a bid to have the input of the Ministry of Finance for the appropriate method to be used.