Judge Mwaungulu to rule on Mulli assets value: Malawi Savings Bank saga

Supreme Court of Malawi judge Dunstan Mwaungulu will on July 9 2015 make a determination as regards the value of Mulli Brothers Limited (MBL) Holdings’ properties up for sale by the State-owned Malawi Savings Bank (MSB) to recover an outstanding loan of about K3.3 billion (US$7.3 million).

CEO Ian Bonongwe - MSB needs new capital

CEO Ian Bonongwe – MSB needs new capital

Mulli: Tussles wtih Malawi Savings Bank

Mulli: Tussles wtih Malawi Savings Bank

Chancy Gondwe, lawyer for MBL confirmed “the injunction is still in force” restraining MSB from selling the properties.

MSB evaluators found that the value of the properties was K4 billion while MBL Holdings evaluators pegged the properties at K6 billion.

Judiciary spokesperson Mlenga Mvula said Justice Mwaungulu will now resolve the matter of valuation of properties.

Mvula also said besides the evaluation reports, the judge will consider other issues the two parties advanced before the court.

“He [judge Mwaungulu ] will also consider other arguments the appellants and respondents presented to him before exercising his discretion whether to continue the injunction that was granted previously or vacate it,” said Mvula.

MSB has been pursuing Mulli who owes the bank a reported 83 percent of the bad debts and the local the conglomerat has since obtained an injunction stopping the bank from selling its properties which were used as collateral.

Government, the sole shareholder in MSB, has put the bank up for sale with only one preferred bidder FDH Bank of Thomson Mpinganjira.

The move to sale the bank is said to recapitalise it to meet regulatory requirements in terms of capital in line with Basel II but critics have interpreted it as a bail-out package for politically linked businesses.

Under pressure from opposition, civil society and the media, President Peter Mutharika ordered a suspension of the sale of MSB to allow more public debate on the issue.

Follow and Subscribe Nyasa TV :

Please share this Article if you like Email This Post Email This Post

More From Nyasatimes

More From the World

16 thoughts on “Judge Mwaungulu to rule on Mulli assets value: Malawi Savings Bank saga”

  1. Interesting is it now that Mulli is pointing fingers at late BINGU and yet soon after Bingu’s death he went on TVM telling all Malawians that late Bingu had no shares what so ever in MBL. Does it mean this guy heart? No wonder JB knew this fanatic and kick him out for she knew what he was up to. Or is it usual business at Nyasa Times to throw in Bingu so that your wish of not selling the bank and the crushing of MBL is justified?
    Secondly why this guy is in this whole trouble and yonder in a deep sea of toxic loan? The problem is us all. In the first place who oppressed this parasite? The answer is simple JB. Despite the warnings by World Bank on JB’s suppression of the company she defied odds by strongly criticized World Bank not to interfere with Malawi’s internal matters as it is a sovereign state and this letter was published in the local papers and was signed by Hanna Ndilowe. We also remember Mr. Kasambala as the then justice minister issuing letters to all government departments not to do business with Mulli and this led to JB importing maize from Zambia and yet Mulli had plenty plus in his warehouses. Even other private traders could not dare to transact with him for fear of being sidelined. To be honest in most governments around the world government is the chief buyer. The other problem is JB’s disgruntled supporters who are continuously squeezing this rascal and yet they pretty sure know that they are a real problem to us all because by denying business to this guy our economy was dealt a big blow. Look now the toxic loan he would have settled is still hanging and who gonna lose? Malawi economy: because both MBL and MSB if not careful are going to be lost. Mulli got loan from the government bank and the very same government issued no business letters with Mulli to everyone, how then would he have been able to pay back? Is this fair? There is no fairness at all-with jealousy we will go no where. Is this the way we are to be behaving; beheading our local entrepreneurs by neck lacing them with explosives for complete elimination? Had it been that this liar was oppressed he would have managed to pay back the loan and this is honest. Local companies owned by Malawians have to be supported fully not to be erased for they are a key to our economic independence. Frankly speaking this bank is a political tool to sustain and oppress our local businesses-hence sale it; every one is using it to punish MBL more especially our politically motivated CSOs. In the first place why not seek accountability in jet sale? We understand JB also have toxic loans with the bank, why then roughing up MBLs neck only? I really wonder whether the so called CSOs are for the healthy cause. SALE IT SALE IT SALE IT SALE IT!!!!!!!!

  2. Cameo says:

    Sorry Mr Mulli you have gone into this because of one hilda mtila after the failed Conference in Lilongwe. When you invested heavily in tourism and the buying of state of art buses for the coming visitors in 2012.
    To make sure to paralyse your business hilda ordered government to close doors for your businesses so you suffocate.

    So accept your entities to be sold to repay the loans at msb and be free so you can restart afresh.

    I will continue praying for you until you come out of this mess.

    Chaona mzako chapita chasala kwa iwe take care Hilda Mtila.

  3. Boyd Kilembey says:

    This case is becoming childish. Now we have to argue whether the assets are worth K4bn or K6bn when the real issue is to repay the loan.
    Malawi is a failed state.

  4. Kenkkk says:

    This is becoming childish and stupid. The valuation of the collateral property or assets has no relevance. What matters is how much those assets will fetch when sold to recover msb money. If the assets will sell for more than what Mulli borrowed including interest, then Mulli will be refunded the difference or overage. But if the assets sell at less than what mulli borrowed, then Mulli will have to pay msb the shortfall or deficit and clear the debt. That could force mulli to sell other assets to meet the shortfall or use own cash to pay the shortfall.

    Valuation of the assets only becomes relevant if the govt or msb want to take over the assets and keep them as its own and then clear Mulli of the debt. In other words the govt or msb keeps the assets, doesn’t sell them now and takes over the runnning of the business itself. This brings the wrangling problems of valuation which we have as to what the assets are worth from msb point of view and from mulli’s point of view. Msb says 4bn, mulli says 6bn. If it is 6bn and mulli borrowed 5bn, then the govt will have to pay mulli 1bn. If it is is 4bn, then mulli will have to pay the govt an extra 1bn. The compromise is that the assets are worth 5bn and if the govt or msb takes over them, then Mulli debt is cleared. But do we want msb or the govt to take over the business and run it? Definitely NO.

    The solution is to seize and sell the assets to recover the debt and if there is any shortfall mulli should pay it. If the assets sell for more than the debt, then mulli will refunded the overage. Mulli doesn’t want this approach because he knows how risky it is that the assets might not meet the debt if sold.

    1. Kizito says:

      mr Kenkkk, the reason we have courts in this country is to give every Malawian a chance to seek legal redress on matters they feel agrieved. Otherwise shortcuts may be used to victimise people. even when thieves are caught stilling they stil go to courts and stand before a competent court. we dont just throw those people to jail no. such kind of thinking is barbaric and un civilised

      1. kenkkk says:

        Kizito, I think you are not following me. I don’t think anyone in his right frame of mind would think it is barbaric or uncivilised to question the relevance of asset valuations in this case. Do you really know the meaning of barbaric or uncivilised?

        I also didn’t say people shouldn’t use courts when aggrieved but there is nothing wrong to question a court’s decision on the matter.

  5. Layman's view says:

    When he put the collateral with the bank when taking the loan,that meant that his properties will sold incase when he fails to honour the loan like the way the bank does with anyone who fails to pay back their loans.The Mulli issue should not be an exceptional one.Nothing personal with Mulli here.

  6. half man half biscuit says:

    Malawians we should not be fooled with blind hatred. A country cannot grow without the private sector. We provide subsidies to subsistence farmers who contribute little to gdp. Mulli employs lots of people and he also produces forex which we need. Reduce his monthly premiums (extend loan period) and give
    him a little tax rebate….it will buy mulli time to restrategise. Stop the hatred. We need more indigenous millionnaires.

  7. Patriot says:

    Gulitsani

  8. ujeni says:

    Dunstain Mwaungulu is a top notch Judge, the best Malawi has, will see how he will judge on this one.

  9. Angoni Apaphata Ife says:

    Mbuzi yakodwa

  10. ujeni says:

    What is so special with this Mulli, how can he hold the whole nation to ranthom? Are we so stupid like this in Malawi really?

  11. ndadabwa says:

    tatopa nazo. tangomuuzani mbuli, mbuzi mulli abweze. kaye nkhope kuchita kuonekera kuti ndi mfiti

  12. kool Runnings says:

    I thot there z value of collateral alien before obtaining loans,who iz changing it

  13. Yusuf Hofmally says:

    Kodi mbuzi inu Nkhani si ya value of assets. Nkhani ndi yoti abweze ndalama ku MSB. Why mukusokoneza nkhani dala? Buying time chani?. Valuation of assets its a very subjective issue. It depends on the motive of the valuer. You can value assets depending on recoverable amount or replacement costs while taking into consideration gains and losses.
    Mukutitenga ngati ndife zichani kodi aMalawife?

  14. Chris says:

    Not funny

Comments are closed.