Africa-Press – Mozambique. The Bank of Mozambique has paid at least $45 million (€41.6 million) to national financial institutions that lent money to Proíndicus, a company that benefited from so-called “hidden debts”, the governor of the central bank said on Thursday.
“I’m not going to hide it from you. We used our reserves to pay these small creditors,” the governor of the Bank of Mozambique, Rogério Zandamela, said on Thursday during a press conference on the results of the meeting of the Monetary Policy Committee (CPMO) of the Mozambican financial regulator.
“$46 million [€42.5 million euros] or 45 million dollars [41.6 million euros] were disbursed, which we ended up using for this,” “for our banks,” which include BIM, Moza Banco and BCI, Zandamela continued.
He said that the agreement with the Mozambican banks that lent money to the Proíndicus project was the result of an understanding between the state and UBS, the institution that acquired Credit Suisse, also a Proíndicus creditor.
The governor of the Bank of Mozambique maintained that the Mozambican creditors were not in a position to write off the Proíndicus debt, because it would mean giving up important resources for the Mozambican financial system.
“Clearly, [the Mozambican financial system] was not in a position to forgive this debt [because], to forgive, in the banking system, means to remove this debt from the portfolio,” he emphasised.
Rogério Zandamela emphasised that UBS had forgiven part of Proíndicus’ debt, describing the operation as a relief for the Mozambican state, but did not specify the sums involved.
“The government played its part, made its reduction and a part [of the debt] was forgiven, the banks lost, but not everything,” Zandamela emphasised.
Mozambique paid $142 million (€130 million), mainly by issuing domestic debt, to financial institutions as part of an out-of-court settlement to end a dispute in the London Commercial Court over “hidden debts”, according to information from the International Monetary Fund (IMF) consulted in January by Lusa.
In its report on the payment of the aforementioned amount, the IMF states that ““in an effort to reinforce governance and transparency and resolve costly disputes related to loans to public companies”, the Mozambican authorities “reached an extrajudicial agreement on part of the Proindicus debt in October 2023”.
“The settlement covers about $522 million of the outstanding principal and entails a cash component (US$46 million dollars) and issuance of domestic T-bonds (MZN 6.2 billion at 6-year maturity; equivalent to US$96 million),” reads the IMF report on the evaluation of the assistance program to Mozambique.
Mozambique previously announced that it had paid $130 million (€119.1 million) to financial institutions as part of an out-of-court settlement with Credit Suisse to end a legal dispute in the London Commercial Court over the “hidden debts” case.
The country is demanding $3.1 billion (€2.8 billion) in damages, compensation and indemnity from the shipping group Privinvest and its owner, Iskandar Safa, whom it accuses of paying bribes to public officials, including former finance minister Manuel Chang, who signed the sovereign guarantees on the loans.
For More News And Analysis About Mozambique Follow Africa-Press
