Minister of Finance Economic Planning and Development, Goodall Gondwe, has said the state-owned Malawi Savings Bank (MSB) is not being sold at at K8000 million , saying government is requesting strategic investors to buy a controlling stake in the bank in which the government owns 100 percent of its shares.
Gondwe disclosed to reporters in the capital Lilongwe on Thurday that First Discount House (FDH) had offered K4.9 billion for 79 percent of the bank’s shares.
FDH bank, founded in 2008, is a 100% subsidiary of FDH Financial Holdings Limited (FDHFHL).
The Finance Minister said government had decided to withdraw from being dominant shareholder of the bank to improve the operations of the financial institution.
“The interest is to run the bank in a more efficient way,” said Gondwe. “All the countries out there did the same with their postal savings banks and they are doing fine.”
According to Gondwe, the discussions and proceedings regarding the partnership of the bank is supposed to be through by March 31st, 2015.
“The Registrar has given us up to 31st of this month (March) or else we risk the closure of the bank,” he said.
According to the Reserve Bank of Malawi , the MSB is weighed down by bad loans and it requires a $48.3 million (MWK 23.7 billion) in capital and liquidity by June to satisfy Basel II financial and regulatory requirements or risk being struck off by the central bank.
The sale of the bank has met resistance from lawmakers who successfully pushed a motion in Parliament last month halting the sale to pave the way for investigations on its viability.
The MPs argue that MSB is the only bank that has wide coverage in the country, especially in rural areas where their constituents are located.