Reserve Bank of Malawi justify rebuffing Mpatsa on MyBucks 49% stake

The Reserve Bank of Malawi (RBM) stands by its ground that it   turned down Mpatsa Holdings Limited’s bid to buy 49 percent stake in MyBucks Banking Corporation (Malawi), formerly New Finance Bank, due to lack of liquid assets, saying the application did not satisfy the requirements of financial services laws.

Jimmy Koreia Mpatsa: This, in a way, is also a contradiction to the new administration’s policy of encouraging local empowerment and job creation

The response from RBM comes after Nyasa Times wanted to find out if the refusal to approve the application was not in line with the Tonse Alliance led government’s agenda of creating an enabling environment for local participation, as contended by the prospective shareholder, Mpatsa Holdings.

Mpatsa Holdings chairperson Jimmy Koreia-Mpatsa expressed disappointment with the criteria the central bank used to turn down the bid, saying it is “in a way, a contradiction to the new administration’s policy of encouraging local empowerment and job creation”.

But RBM spokesperson Onelie Nkuna told Nyasa Times she could not respond to Mpatsa Holdings’s assertion, saying “under the law, the Registrar of Financial Institutions office deals with financial institutions and not individuals per se”.

She said applications received by the Registrar’s office from commercial banks are different and not similar but subjected to the same requirements.

“The Registrar of Financial Institutions office considers a number of factors in assessing the suitability of a prospective shareholder to acquire a significant stake in a bank (please check on the website with regard to the requirements).

“Unfortunately, the prospective shareholder, having been assessed in line with the criteria stipulated under the financial services laws, did not satisfy the requirements of the law.  The position of the [RBM]  was duly communicated to the Banks client, which is Mybucks Bank,” Nkuna said.

In June, Mpatsa announced that it had acquired 49% shareholding in MyBucks Banking Corporation and this week issued another statement that RBM has not approved the application on the grounds that Mpatsa only has fixed assets which may not be liquidated quickly should there be need in the near future to provide additional support to the bank.

However, the statement from Mpatsa questions if this is a criteria for one to invest in a financial institution, saying it has never been applied to any of the existing bank’s shareholders.

Mpatsa contended that it had indicated during application for the shareholding acquisition that should such a situation arise, there are several options available to it such as: dilution of shareholding; liquidation of assets; obtain financing etc but our pleas fell on deaf ears.

MyBucks is a Fin Tech company domiciled in Luxembourg that delivers financial services through technology. It operates in six African countries through its brands Getbucks, GetSure, MBC and Opportunity Bank.

Through its investment arm, Mpatsa Holdings, owned by business mogul Koreia-Mpatsa, the company has interests in several sectors of the economy, including mining, agriculture, hospitality, real estate, pharmaceuticals, distribution and marketing

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2 years ago

The reporting on this leaves out a lot of details and one tends to wonder if the reporter was just issued with this copy and hasty posted it.
When you read the report it gives an impression that there are two entities namely MHL and another one which is not mentioned here and we can safely call it JKM in the absence of information. To the reporter(DM) do we have enough information to start questioning the conduct of RBM

2 years ago

The Reserve Bank has acted harshly to the request, Options were not given to Mr Mpatsa to liquidate some of his assets to qualify. This problem has to do with mindset change of people working in the high Institutions that are not performing as per Malawis expectations. Reserve Bank is one of them, they always hide behind secret and confidentiality acts to run away from their incomptency and inefficiency. Resrve Bank of Malawi as Supervisor of Financial Institutions is failing in the following, Failing to supervise All Commercial Banks on Customer Relations and Prompt attendance to Walk in Customers/Clients. With… Read more »

2 years ago
Reply to  DRAKE

It is very bad to attack the President on issues like this one. He does not even know about this matter and please dont take things for granted.

Kondwani Kelvin
Kondwani Kelvin
2 years ago

It Right Decision by RBM Not to Approve Application of an Individual to be Holding a share Holding of A Bank 1 why is Mphatsa Holding interest in a Bank Holding 2 it is possible that his Companies have a Hugh Debit and As due to COVID Most of the Business are Suffering Liquidity Crunch and Shortage of Forex in the Country 3 Has Reserve Bank Checked the Audited Accounts of Mphatsa Holding and is he a Regular Tax Payer of Malawi 4 Is Mphatsa Holding companies Not involved in Any Govt.Deales RBM should also check his Personal Dealings they… Read more »

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