The sale of the state-owned Malawi Savings Bank (MSB) will still go ahead despite disapproval from parliament. Public Private Partnership Commission (PPPC) has confirmed.
The government’s divestiture agency kicked off tenders’ process on Monday requesting strategic investors to buy a controlling stake in MSB in which the government owns 100 percent of its shares.
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.
Malawi’s fastest growing bank, FDH k has expressed interest and it is highly tipped that they will buy the tax payer stakes in the bank.
The bank, founded in 2008, is a 100% subsidiary of FDH Financial Holdings Limited (FDHFHL).
But FDH Bank Managing Director Phillip Madinga kept his comments close to his chest when he witnessed the opening of the tenders.
Both Finance Minister Goodall Gondwe and PPPC Chief Executive Officer Jimmy Lipunga deny any wrongdoing in opening tenders.
“We have no reason why the process would change. We get our instructions from the Ministry of Finance and government procedures are driven by laid down process. All the required procedures are being
followed”, Lipunga told reporters.
Lipunga expressed confidence that “the deal will go well.”
Finance Minister said Parliament had no powers to stop the sale.
“Right now the process of identifying an independent valuator to determine the wealth of MSB is underway and curtail the process would attract legal challenges,” said Gondwe.
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.
Meanwhile, PPPC also opened tenders for the capitalisation of IndeBank. Five companies expressed interest for the purchase of the bank and these include FMB,NBM, Commercial Bank of Africa and MBL HoldingsFollow and Subscribe Nyasa TV :