MK128 Billion Gamble: Inside the High-Risk Amaryllis Deal Putting Civil Servants’ Pensions on the Line

A high-stakes financial drama is unfolding in the corridors of power, pitting Malawi’s top legal and anti-corruption offices against its central bank. At the heart of the storm is the Public Service Pension Trust Fund (PSPTF) and its controversial attempt to purchase the luxury Amaryllis Hotel for a staggering MK 128.75 billion.

For thousands of civil servants whose retirement depends on this fund, the issue is no longer about luxury real estate. It is about whether their life savings are being exposed to a risky transaction.

The Deal: From 47 Billion to 128 Billion

The controversy began when the Malawi Law Society raised concerns over what it described as suspicious circumstances surrounding the transaction. Allegations emerged that the hotel was valued at MK 47 billion just a year earlier. By the time the contract was signed on November 17, 2025, the price had risen sharply to over MK 128 billion.

The Society questioned how the price could nearly triple within a year. It also alleged that the PSPTF Board had previously rejected the deal as “not viable” based on expert advice, only for a newly reconstituted Board to approve it in late 2025.

The Investigations: “No Crime, But Big Risks”

As public concern intensified, the Anti-Corruption Bureau and the Attorney General stepped in.

In a report dated December 18, 2025, ACB Acting Director General Gabriel Chembezi stated that the Bureau had not found sufficient evidence of criminal corruption. However, it raised serious concerns about the transaction, including operational risks, the lack of involvement of Fund Managers, and the sharp increase in the purchase price.

Despite these concerns, Attorney General Frank Farouk Mbeta adopted a more permissive position. In a letter dated December 28, he indicated that the transaction could not be faulted solely on the basis of the risks involved and advised the Board to proceed and conclude the deal.

The “Red Alert” from the Reserve Bank

Just as the transaction appeared set to close, the Registrar of Financial Institutions at the Reserve Bank of Malawi intervened.

In a “Strictly Private and Confidential” letter dated January 6, 2026, Dr. MacDonald Mwale issued a sharp warning. His assessment was direct: the transaction may not only be risky, but could also breach investment regulations.

He cautioned that the proposed purchase was likely to exceed investment limits and create serious liquidity mismatches and concentration risks. As the third-largest pension fund in the country, any instability within PSPTF could have far-reaching consequences.

The warning was clear: any imprudent investment decision could significantly endanger members’ benefits and undermine the stability of the pension sector.

The Core Conflict

The standoff reveals deep divisions within government institutions:

• The Attorney General views the transaction as legally defensible and argues that contractual obligations must be respected.
• The Anti-Corruption Bureau sees no clear criminal conduct but identifies serious governance and pricing concerns.
• The Reserve Bank Registrar warns of regulatory breaches and systemic financial risk that could destabilize the pension sector.

What Is at Stake?

For the average public servant, technical terms such as “liquidity mismatch” translate into a simple fear: Will my pension be safe?

The PSPTF is funded through a 5 percent contribution from employees and a 10 percent contribution from government. With MK 128 billion at stake, the Registrar has formally advised the Board to reconsider its decision.

The government must now weigh the legal consequences of halting a signed contract against the financial risks of proceeding with a potentially destabilizing investment.

For many Malawians, the Amaryllis Hotel is no longer just a luxury landmark. It has become a symbol of a high-risk gamble involving the retirement security of thousands of teachers, nurses, police officers, and civil servants across the country.

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