MPs not exactly wrong on Malawi Savings Bank: Tenthani’s Muckraking

It is a fact that the Malawi Savings Bank (MSB) has fallen on hard times. It is failing to meet the minimum liquidity requirements as per Basel III (or the Third Basel Accord) specifications.

Malawi Savings Bank

Malawi Savings Bank

Without seeking to bother you with monetary-speak, Basel III isa global, voluntary regulatory framework on bank capital adequacy, stress testing and market liquidity.Basel III requires every bank to have a minimum liquidity reserve of US $5 million.

MSB is 99 percent owned by theMalawi Government which – in itself – is a violation of the law since the laws (Section 53 of the Financial Services Act) do not allow an individual or entity to hold more than 49 percent in a financial institution. (Of course, the Registrar of Financial institutions can waive this requirement.)

But owing to the requirements of the law, the best the government should have done could have been to float 51 percent of its shares on the Malawi Stock Exchangeand not an outright sale to a single entity. This would have allowed MSB to generate enough revenue to meet the Basel III requirements.

Unarguably, most of MSB’s problems border on political interference in its management. Due to political meddling the bank has undertaken some needless costly undertakings.

The bank, for example, was forced to grant concessionary loans to students of public universities. It was also forced to finance the Farm Input Subsidy Programme and the politically-motivatedMardef.

Some politically well-connected individuals were even granted billions worth of unsecured loans. Not surprisingly they are failing to service these loans.

In my view taking politics out of the running of thebank can easily stabilise it.

I am, therefore, inclined to agree with Members of Parliament who feel the bank must not be sold. For those who do not know, the genesis of MSB is the Post Office Savings Bank (POSB) which was established under the Post Office Savings Bank Act (Cap. 44:03 of the Laws of Malawi).

When government decided to form MSB to replace POSB, it should have repealed the Post Office Savings Bank Act. This was not done and, therefore, MSB is – in my view –is a mere brand name for POSB for which Parliament should have a very big say.

Forming MSB to replace POSB and to take over all its assets without first repealing the Post Office Savings Bank Act is actually illegal. POSB is a baby of Parliament and the august House has all the right to demand a say in its future.

MSB is potentially the biggest bank in Malawi with the widest reach. It should not be sold illegally and for a song for that matter.

 

 

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37 thoughts on “MPs not exactly wrong on Malawi Savings Bank: Tenthani’s Muckraking”

  1. khuere says:

    very true comments alhomwewa muwaone bwino ifeyo ndi ahlomwe , koma osaba

  2. THE FIRST MADNESS WAS SOLVED BY THE ARREST OF THE CARDIAC, WE CAN SEE SOMETHING SNAKING TOWARDS THE CURRENT MADNESS, BUT AM NOT SURE WHAT IT IS. FROM A DISTANCE IT LOOKS LIKE GOD THIS TIME AROUND

  3. Chikumbutso Mkumbila says:

    AMalawi Ufulu ukutipangitsa kuti tidzivutika kwambiri mukanakhala kuti muli RSA bwenzi Malawi ali otukuka kwambiri koma nkhani ya UFULU eish!! Its too bad for me

  4. ineyoooo says:

    Mr gondwe u need to be a serious man. U are not dealing with kindergarden kids. U can’t be saying that something and then later saying I was misunderstood. Be serious man. Why didn’t u say u were misunderstood once you saw it in the papers. But u had to wait for the deadline to be approaching then u say “I I I wasss misunderstood. Again be serious man

  5. Kada says:

    Basel II, Ralph. Not Basel III.

  6. mphande yituwa says:

    They want to rob bank which is bad to malawians

  7. Malawiansturo says:

    We really know what is going through at MSB and the Thom Mpinganjira ‘s are JUST being used similarly how he syphoned money from Capital Hill through Cash gate.The problem with Malawians is that they have TOO MUCH ULEMU.If this nonsense took place in countries like South Africa or Zambia you would have seen people in the streets of Malawi but ha!!! they are good talking under the blanket.

  8. 100% Lohmwe says:

    No don’t sale the MSB. Please ngati muli pampando kuti muthandize dziko lanu,mukwenye onse ana kongola Ma Billion,ku Bank iyi abweze

  9. human says:

    Mukakhala kuti ngini simukuyiza mumangoti let me not bother you with this and this speak. Tatambasulani Basel-yo ife timve bwino bwino

  10. Abale samalani says:

    God is watching

  11. Mngoni says:

    For once MPs, make a good decision on this please!

  12. Wilson says:

    I agree with you. Poor performance of the bank is because of political involvenment.

  13. Mulli is one of the bidders for Indebank, yet he is failing to repay MSB loan. Mpinganjira’s FDH is the sole bidder of MSB. Mulli is from Mulhakho territory. So too is Mpinganjira. Govt plans to sell MSB minus Mulli’s loan. People let’s be serious. You can’t cheat us.

  14. tuvitwana says:

    Dream Team ukunsma, the issue here is Mulli apereke kaye ngongole then agule bankiyo. U sound like Mlomwe already kkkkk

  15. Kaligondo says:

    Kodi ndege itagulitsidwa zinayenda bwanji? Lero ndi bank muziona ,amalawi penapake timapanga zinthu ngati tifa mawa makamaka andale za munthu wakumudzi simuganiza chonsecho abale anu alikomweko mulungu adzakulangani

  16. Msb client says:

    Osagulitsa bank yathu…ife ngongole tikatenga kuti….ife akumudzi sitikugwilizananazo…..A CEO,Akugulani eti….

  17. akulu says:

    I suspect foul play on this sale of MSB. Why people are not complaining about selling of inde bank yet its partly owned by government. How can mulli bid to buy a bank yet is failing to repay the loan

  18. Mwama Du says:

    Ill intension of our governnent again.

  19. panyani says:

    Mphiri ikumeza nsato, hehehede uluuuu. Muziona pa Malawi, ndi momwe munavotera

  20. yona says:

    Ian mbolo yako

  21. Mwaminula says:

    Tenthani…a know it all drunkard.

  22. crocodile says:

    selling msb is defeating government own policy of financial inclusion and competition in the sector …why goodhal can’t see this is beyond me

  23. dreamteam says:

    Ok if you float this on stock exchange, who becomes the majority shareholder? The same government – which will appoint a politically connected CEO who will eventually make the same silly decisions.

    Government the world over should not be involved in banking – not retail banking.

    Kwathu kuno yakula ndi Nsanje basi. If this bank was being taken over by a foreign company, we would all be clamping hands.

  24. Joseph Banda says:

    A Tenthani, You do not know what you are writing. Actually this is a copy write that I read yesterday on this. You have never owned a Company, Run one and done any business. You are not a business adviser. Leave this to people in the know. If some one is buying 75% of the shares what makes you think that creditors and loans will be written off? Bwanji mudzingolemba zanuzo. But do not to an area you do not know

    1. makito says:

      A Banda, you seem not to be following the story. Maybe Raphael is actually more informed on the issue than yourself.

    2. Wailing Soul says:

      Joseph Banda: Copy write? What’s that supposed to mean? In opinion, Tenthani has articulate the issue in a simple manner for news audiences to understand. Its very clear and easy to understand and that’s the whole essence of journalism.

  25. mbwiyache says:

    Useless comment. Palibe fact, iwe yemwe ukuti Registrar can waive this requirement?????? Look at ownership of Banks in Malawi, and ask yourself for example who owns Nedbank, Ecobank, Standard Bank, NBS Babk and others, i mean look at the shareholding structure.

    Vuto lathu a Malawi ndi nsanje, chonsechi zikuwawa chifukwa ndi Mpinganjira wa FDH akugula. Mmalo moto tisangalare Mmalawi zanthu akukatamuka ife basi kadukaaaa. MPs alibe mphanvu MBS does not fall under Act of Parliament. PERIOD

    Game yagona FDH, acquires MSB baasi, ndimmene anzanu amakhalira zikhwaya kunjaku ask Ross Perot, akuuza mmene umakatamukila pogula makammpani. Kaduka a Malawi, koma apa pokha, ndi ma PM anuwo, MUISOVA-MSB branded FDH wautali

  26. wagwanayo says:

    Tenthani please do not comment on issues you are unfamiliar with. Malawi has not adopted Basel III. We are at Basel II and Basel II has not set $5million as minimum capital.

  27. Sandalasi says:

    Our Highly Valued Mps,continue Thinking Big Over MSB Issue. “Rural People At Heart”

  28. Makala a Tsanya says:

    I may be a notice in banking and financial matters but can understand some issues the affect my life especially what our government is doing. We need to call a spade a spade. Let all those that owe this bank money repay the money and take the bank on stock Market since the back is owned by Malawians let ordinary citizens buy shares than these lomwe guys who are manipulating us with information to think they are the savoir yet they are the guys behind the mess. Let’s not give them the bank instead let the public buy shares through stock market si zaumbombozo and kudzikonda. Mr Mulli and your Lomwe friends pay back ngongole

  29. kyula says:

    kkkk; the circus is: Ian Bonongwe-Mulli-Ian Bonongwe – Chuka-Ian Bonongwe-Mpinanjira. Noophiya!

  30. Milward says:

    I guess ‘not exactly wrong’ means right. Why can’t you say it as it is?

  31. sikusinja says:

    On top of that the only bidder doesn’t open his bank on Saturdays when our relatives depend on going to the trading center on Saturdays to conduct business

  32. Namchunjule says:

    A DPP kufuna kuba,kugulitsa bank kuti ndalama zina agawane

  33. mbwaxe says:

    Chavuta apa ndikuba!!!!!!!!! Stealing is in the blood of malawians!!! Pa nyo panu nonse a malawi!!!! What a stupid country!!!!!!!!!!!!!!

    1. zte says:

      aaa akulu ife talakwa chani mpaka phuzo ngati zikutikhudza

    2. angoni says:

      Mpaka kutitukwana. Of course kubako ndiye ndi vuto mudziko mwathu muno

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