Allied Bank
Trading name
Allied Bank
Formerly called
Zimbabwe Allied Banking Group (ZABG)
HeadquartersHarare, Zimbabwe

  • Commercial Bank

Allied Bank of Zimbabwe Limited was a Zimbabwean commercial bank whose license was withdrawn on 8 January 2015. The Bank was formerly known as Zimbabwe Allied Banking Group (ZABG). The Bank was owned by Zimbabwean politician and business mogul Obert Mpofu. The bank struggled to meet depositors' withdrawal of funds for the number of years before finally giving up its license.


Zimbabwe Allied Banking Group was founded and commenced operations on 31 January 2005. The bank was formed from the purchase of assets of three troubled banks namely Trust Banking Corporation, Barbican Bank and Royal Bank, under the Troubled Bank Resolution Plan (TBRP) framework, as a measure to restore the safety and soundness of the financial services sector.[1]

The 3 banks had been placed under curatorship by the Reserve Bank of Zimbabwe after it emerged that the three financial institutions were abusing depositor's funds.[2]

In May 2010, it was reported through a diligence report by Deloitte and Touche Corporate Finance and a verification report by the Reserve Bank of Zimbabwe that the bank was saddled with potential liabilities of more than US$12 million due to alleged mismanagement of depositors' funds.[2] It was also alleged that the bank was spending a lot of money on luxury vehicles, fuel and allowances for the top management thereby further burdening the institution. The top management of the bank was rumoured to be getting US$ 5OO allowances on fuel, the total cost of lunches and dinners going for as much as US$36 460 a month.[2] The management was also accused of having made several salary increments in anticipation of severance packages if the bank is returned to the original owners.

ZABG was unbundled into four institutions namely Trust Banking Corporation, Barbican Bank, Royal Bank and ZABG, following the re-registration of the first three with effect from 1 September 2010. The handover/ takeover of assets by the re-registered institutions was completed by 31 December 2010.[1] In early 2013, ZABG commenced rebranding to Allied Bank.[3]

The Obert Mpofu Era and the Rebranding

In March 2012, it was widely speculated that Obert Mpofu through his company Trebo & Khays (Private) Limited was interested in buying into Zimbabwe Allied Banking Group at which time it generally public knowledge that the bank was already facing operational constraints. There were also other two companies identified as Unicapital Finance of Mauritius, Swiss-based AFG Global and a local company Trebo & Khays (Private) Limited which were also interested in buying into the bank.[4] Eventually it was Mpofu who managed to acquire a stake in the bank. It was reported that Mpofu was owed a substantial ammount by the bank which he later on converted to equity. An unnmamed source made claims to the effect that the bank was also keen on utilising assets alleged to be owned by Mpofu in Bulawayo to strengthen its capital and asset base.[4] In line with the entry of Mpofu into the financial institution, they bank went on a re branding exercise in which it changed its name from ZABG to Allied Bank in an attempt to turn around the fortunes of the bank.[5] It is said that Mpofu injected US$22 million into the bank effectively acquiring 99,5% of the bank. Commenting on the rebranding exercise the bank had undergone, the Group chief executive Stephen Gwasira stated that

The rebranding was always part of the plan and has always been seen as the next logical step for the organisation, and we are proud to be unveiling such a modern and progressive look, which demonstrates the progressive nature of the organisation. The process will be completed in the next few months and the result is a more customer focused, progressive, energetic organisation, ready to serve our customers.In the next few weeks the market will see many exciting changes at Allied Bank and these are all being implemented to ensure a better customer experience as well as ensuring that the Zimbabwean banking landscape is positively transformed. We have designed world class branches that are comparable to any worldwide and in the next few weeks customers will be able to enjoy this new experience.[5]

Having gone through a much publicised and rebranding exercise, the fortunes of the bank did not improve as it continued to under perform. This was mirrored in the fact that sometime in June 2014 the workers of the financial institution were said to have been put on unpaid leave. It was said that up to 99% of the banks employees had gone on voluntary unpaid leave for a period of upto four months in a bid to cut the expenses that the bank was incurring. There were growing concerns among the workers that the bank's under performance was due to mismanagement more than anything else. The worsening situation forced the workers into writing a petition to the central bank complaining about how they had been treated by the management.[6] The petition seems to have been fuelled by the bank's failure to to pay bonuses and is in arrears in terms of paying workers’ salaries since November 2013.[6]

Bank's Closure

Following successive years of under performance, Allied bank was eventually closed. It was reported that the bank voluntarily surrendered its license due to lack of capital and liquidity. In a statement announcing the closure of Allied bank, the central bank posted that

Members of the public are advised that on 8 January 2015, the Reserve Bank of Zimbabwe cancelled Allied Bank Limited’s licence in terms of section 14 (4) of the Banking Act [Chapter 24:20],” read the statement. The cancellation followed a voluntary surrender of the licence by the banking institution. The Reserve Bank has determined that the banking institution is no longer in a safe and sound condition in that the institution is grossly undercapitalised and is facing chronic liquidity challenges.[7]

The DPC Payout

After the bank was closed, the Deposit Protection Corporation made payouts to depositors that had lost money through the bank's closure. The other banks whose clients were being given payouts include Geneis and Royal bank, the payout to former Allied Bank was set to commence as soon as a provisional order had been issued by the High Court. The primary objective of DCP is to compensate depositors partially or in full in the event of insolvency of a contributory institution.[8]

Property Attached

After the bank was closed, things did not seem to get better after their property was attached by the deputy sheriff in a bid to settle a debt that the bank had with Zimbabwe Amalgamated Housing Association (Zaha). The debt was said to be amounting to US$1,5 million. ZAHA had been given permission by the authorities to attach property owned by the bank in December 2014 but had not moved in to attach the bank's property after they had been given assurance that the bank had found an investor.[9] Allied Bank had been facing perennial liquidity challenges since its inception and several attempts to lure investors did not yield anything culminating in the bank's closure.


  1. 1.0 1.1 ZABG Bank Limited, Reserve Bank of Zimbabwe, Retrieved:1 February 2015
  2. 2.0 2.1 2.2 Steve Zimbabwe bank in trouble, The Zimbabwean, Published: May 17, 2010, Retrieved: January 9, 2015
  3. Fanuel Kangondo ZABG changes to Allied Bank, The Herald, Retrieved:1 February 2015, Published:17 December 2012
  4. 4.0 4.1 Obert Mpofu buying into a Zimbabwean bank, Published: March 5, 2012, Retrieved: January 9, 2015
  5. 5.0 5.1 Obert Mpofu's ZABG rebrands to Allied Bank, Bulawayo 24News, Published: February 8, 2013, Retrieved: January 9, 2015
  6. 6.0 6.1 Allied Bank problems worsen, Zimbabwe Independent, Published: February 7, 2014, Retrieved: January 9, 2015
  7. Mpofu’s broke Allied bank collapses, New Zimbabwe, Published: January 8, 2015, Retrieved; January 9, 2015
  8. Walter Muchinguri DPC pays out $477 000 to bank depositors, The Herald, Published: January 14, 2014, Retrieved: January 14, 2015
  9. Tarisai Mandizha Allied Bank property attached, Published: January 10, 2014, Retrieved: January 15, 2015