Zimbabwe Said to Have Raised $200 Million to Repay Bank Seizures

Zimbabwe issued $200 million of bonds last month as the government repays lenders for money seized from the accounts of tobacco farmers and other clients, according to an official with knowledge of the matter.

The three- to five-year bonds were issued to local and foreign banks, said the person, who asked not to be identified because the sale hasn’t been made public.

The government announced in November that it planned to offer Treasury bills to settle $1.35 billion in debt, which accumulated after the central bank raided foreign-currency accounts between 2006 and 2008. The bank owes $754.3 million to domestic creditors and $596 million to lenders outside Zimbabwe, the state-controlled Herald newspaper reported.

Zimbabwe’s Deputy Finance Minister Samuel Undenge didn’t answer calls to his mobile phone.

The government also raised $2 million last week from selling 180-day Treasury bills with an interest rate of 9.5 percent via private placements to banks and pensions funds, the person said. Zimbabwe has raised $8.5 million this month compared with $32 million in June, the person said.

In 2012, the central bank failed in its first auction of Treasury bills since the country abandoned its currency and adopted the dollar and other currencies in a bid to curb surging inflation four years earlier. The central bank previously printed money to pay government debts, fueling inflation to an estimated 500 billion percent, according to the International Monetary Fund.

Foreign banks that operate units in the southern African nation include the U.K.’s Barclays Plc, Old Mutual Plc and Standard Chartered Plc, Togo’s Ecobank Transnational Inc. as well as South Africa’s Standard Bank Group Ltd. and Nedbank Group Ltd.

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