News / Local
Luxury cars that will cost Bulawayo its iconic buildings
19 Apr 2012 at 10:57hrs | Views
A Range Rover, Toyota Prado and a Toyota Fortuner bought for Bulawayo City Council look set to cost Bulawayo its iconic buildings following revelations that the MDC-T led city council has failed to pay back a commercial bank the loan.
Kingdom bank has threatened to seize Tower Block and Revenue Hall â€" two of Bulawayo's main landmarks â€" after the city council failed to repay a loan used to purchase luxury vehicles for officials.
Officials who secured new wheels under the deal include Town Clerk Middleton Nyoni, who took delivery of a Range Rover, Finance Director Kimpton Ndimande (Toyota Fortuner) as well as the director of Housing and Community Services, Isaiah Magagula (Toyota Prado).
The MDC-T led city council is understood to have borrowed US$5.7 million from Kingdom Bank last year with US$4.5 million being used to purchase luxury vehicles for top officials while the balance was used for recurrent expenditure including workers' salaries.
However, the bank has now moved-in to seize council properties after the cash-strapped local authority failed to re-pay the loan within the agreed 12 months.
Apart from the Tower Block, its grounds and Revenue Hall, the Bank has also targeted the Tregen, Parkhurst and Lyndhurst blocks of flats and the Matsheumhlophe water reservoir.
According a recent council report, although the loan facility carried a provision for an extension of the repayment period, the bank is now demanding collateral due to "changes in the market."
"Because of subdued cash inflows the Financial Services Department would like to exercise the option of rolling over for another 12 months (but owing to) changes in the financial market the bank now demanded collateral security in the form of title deeds to some fixed property," reads the report.
And adding to the council's woes, it has also emerged that titles deeds for most of the buildings targeted by the bank cannot be located.
"It has been noted that the majority of council properties are not registered and as such could not be used as collateral," the report added.
"Revenue Hall is sitting on six stands and Tower Block on three stands, the actual title deeds have not been sighted but are thought to be kept at the City Hall record files."
Kingdom bank has threatened to seize Tower Block and Revenue Hall â€" two of Bulawayo's main landmarks â€" after the city council failed to repay a loan used to purchase luxury vehicles for officials.
Officials who secured new wheels under the deal include Town Clerk Middleton Nyoni, who took delivery of a Range Rover, Finance Director Kimpton Ndimande (Toyota Fortuner) as well as the director of Housing and Community Services, Isaiah Magagula (Toyota Prado).
The MDC-T led city council is understood to have borrowed US$5.7 million from Kingdom Bank last year with US$4.5 million being used to purchase luxury vehicles for top officials while the balance was used for recurrent expenditure including workers' salaries.
However, the bank has now moved-in to seize council properties after the cash-strapped local authority failed to re-pay the loan within the agreed 12 months.
According a recent council report, although the loan facility carried a provision for an extension of the repayment period, the bank is now demanding collateral due to "changes in the market."
"Because of subdued cash inflows the Financial Services Department would like to exercise the option of rolling over for another 12 months (but owing to) changes in the financial market the bank now demanded collateral security in the form of title deeds to some fixed property," reads the report.
And adding to the council's woes, it has also emerged that titles deeds for most of the buildings targeted by the bank cannot be located.
"It has been noted that the majority of council properties are not registered and as such could not be used as collateral," the report added.
"Revenue Hall is sitting on six stands and Tower Block on three stands, the actual title deeds have not been sighted but are thought to be kept at the City Hall record files."
Source - news
