THE Development Bank of Zambia (DBZ) has taken legal action against Chita lodge for failing to settle over K100 million it got to from the institution to build a resort in Samfya.
When DBZ appeared before the Committee on Parastatal Bodies, Tuesday, Mafinga member of parliament Robert Chabinga wondered why DBZ has taken long to institute legal proceedings against Chita Lodge while his Luena counterpart, Mubita Anakoka, wondered why the bank had not repossessed the lodge by now.
In response, Ministry of Finance Permanent Secretary for Economics and Finance Danies Chisenda said the bank does not rush into taking legal action against its clients before other avenues are exhausted.
Chisenda said legal action was the last resort when the promoter fails to pay back the loan
Meanwhile, DBZ managing director Samuel Bwalya said taking legal actions against a client meant repossessing the property and selling it off to recover the money.
“We have started the process to take legal action, it’s a long process. Depending on how courts expedite hearing of the case, we conclude then we get a letter of possession to poses the property. They have a real estate property in Kafue which we agreed to sub-divide and sell to enable us recover our money. The process takes long due to processes involved with ministry of lands,” said Dr Bwalya.
The latest auditor general’s report has indicated that Chita Lodge owes DBZ K103, 453, 269 (K87, 273,723 interest and K16, 179,546 principal) and there is no evidence of any legal action or re-negotiation made regarding the loan