Mugabe's lavish son loses $US300 000 loan bid

PRESIDENT Robert Mugabe's teenage son Bellarmine Chatunga has reportedly lost a bid to borrow US$380 000 from a local commercial bank - BancABC - to fund his undisclosed business venture, a weekly private publication The Zimbabwe Independent has revealed.

According to the publication, Chatunga (19) - Mugabe's last born - who is well-known in social circles for pursuing a lavish lifestyle - approached the bank in the capital Harare last month pushing for a loan at its corporate finance division to fund his "nondescript businesses and extravagant way of life".

But the bank rejected his application "as it seeks to contain non-performing credit to politically exposed persons on its books", the publication said.

According to the exclusive report, BancABC's debt portfolio stands at US$2,28 million with politicians toping the list of high-profile persons owing the bank.

"Chatunga approached the bank around August 23 for a loan. He wanted to secure funding for his business interests, but this application was rejected by the corporate finance department," a banking source is quoted as saying by The Zimbabwe Independent. "The bank is currently owed millions by many politically exposed individuals and businesses, and thus its management is now strict on lending."

BancABC managing director Joe Sibanda could not be reached for comment as he was said to be in a meeting with the group chief executive John Vitalo. Chatunga could also not be reached for comment.

Chatunga's failure to secure a loan from BancABC is a rare example of prudent credit risk assessment by a local bank as most of them would be keen to lend to such a high-profile and well-connected individual - even if he is a teenager - as he comes from the First Family which can potentially offer political protection in times of trouble.

Chatunga's loan application comes at a time when his own family business empire, Gushungo Holdings, has been surviving on bank loans which it is struggling to service. According to the report by the Zimbabwe Independent, Chatunga - who has business interests in retail and entertainment - had a meeting with Lincoln Farai Chirinda who works for BancABC's corporate finance department to get money but his proposal was however rejected by the financial institution, citing high political risk.

BancABC is a member of the Atlas Mara Group which is co-owned by former Barclays Plc CE Bob Diamond and billionaire Ashish Thakkar. The acquisition was the first major deal by Diamond who was forced out of the global bank last year when it was fined US$450 million for allegedly manipulating the Libor interbank lending rate.