Malawi Savings Bank staff bays blood for CEO, demand halt of bank sale

Malawi Savings Bank (MSB) staffers have threatened to resort to industrial action by Monday next week should their Chief Executive Officer (CEO), Ian Bonongwe, not step down.

The employees of the struggling government wholly owned bank, mostly junior staff members, have in writing accused Bonongwe of “incompetence.”

According to the employees, Bonongwe is the cause for the bank’s poor performance, lack of negotiation skills to recover to recover loans, nepotism and top management extravagant expenditures.

“We strongly demand that you, sir, the CEO of MSB, Ian C. Bonongwe, should take leave of office (MSB) by 12 noon Monday 16/03/15 failing which we shall resort to industrial action which is in line with the labour laws,” reads the letter in part.

The employees further described Bonongwe as a failure for succumbing to government’s intention of selling the bank.

Despite parliament’s disapproval of selling the bank, government has gone ahead with the move. First Discount House (FDH) is the sole institution that has expressed interest in buying MSB.

Peter Dimba, of the Budget and Finance Committee of Parliament, had described government’s intention to sell the bank as an attempt to rob people.

“Government intends to sell the bank to a few individuals including FDH at a giveaway price when the bank’s assets as of November 2014 were in excess of K46 billion,” he had said.

According to Dimba, the “Central Bank was deliberately inflating the capital requirement for the bank to be Base II compliant to K23.7 billion when in fact the bank needs only K5 billion to recapitalize to optimal levels.”

Public Private Partnership Commission (PPPC) this week opened tenders to identify a strategic investor to buy a controlling stake in the bank.

And ironically, only FDH Bank Limited expressed interest to buy the stake.

Members of Parliament vehemently rejected the sale of the financial institution which is wobbling in the thick of dismal performance in both capital and liquidity requirements.

The bank, according to Reserve Bank of Malawi (RBM) records, is yearning for a minimum financial bailout of K23.7 billion by June 2015 to meet its capital and liquidity demands.

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