Kamlepo Call For Peter Mutharika Resignation Over MSB Sale

There was a heated debate in the National Assembly after learning that the Malawi Savings Bank sale has been reached and the government has signed the deal with FDH Bank on Thursday morning.

The information reached the house in the afternoon and resulted into the early lunch break as members began to demand for more explanations from the government over the decision.

Immediately the house resumed sitting in the afternoon a lot of members of parliament including Uladi Mussa, member for Salima South asked why the Minister had decided to sell the bank yet the house had on Wednesday passed a motion which restricts sale of MSB instead, provide enough resources.

He even asked why the sale was done yet the president announced the suspension of the sale.

However Minister of Finance Goodall Gondwe said “Before we took this action president announced his decision that we can now go on with the sale.”

The national assembly passed resolution to halt to sale the bank when the committee on Budget and Finance on Wednesday brought in the house, a report which recommended government to use other avenues except sale of the bank

Rumphi East legislature, Hon. Kamlepo Kalua while wonder to whose interest did the President had announced the decision to sale the bank made a strong call that “Am therefore calling the resignation of the president of the Republic of Malawi Professor Peter Mutharika!

Chakwera

But Leader for the house in the National Assembly Francis Kasaila tried to rescue the president invain by saying “This is an executive decision on behalf of all Malawians” and added that the decision was legal

Leader of Opposition Hon. Lazarus Chakwera said, the decision to sale the bank was lack of transparency from beginning to end

He said the minds of the executive were made up to go for the decision and set aside loads of calls from the public.

He said people should expect more problems in future and the poor Malawian will pay the price.

He also bemoaned that the relevance of National Assembly on the matter was overlooked

There were emotions as the motion was being debated to the extent that the Deputy Speaker of the National Assembly Esther Chilenje pleaded for debate of the matter with “sober mind”

Chairperson for Agriculture in the National Assembly Hon. Felix Jumbe registerd his concern in the house saying the sale of MSB is a loss to Malawi’s strategic asset.

He even suggested that Malawi would have recapitalized the bank by asking people to contribute K20, 000 per person which would have raised over K50 billion.

“You are causing poverty to people of Malawi by selling the Malawi’s strategic assets” and pleaded for rescind of the decision 

Hon. Juliana Lunguzi

Dedza East Parliamentarian Juliana Lunguzi described the sale as one of the worst decision ever made and worried if the laws of the land are any important regarding that by requirement of the law the house had presented report which the whole house adopted and restricted the sale of the Bank. She then questioned the relevance of the existing laws.

MSB Sold to FDH as Inde Bank Bought By National Bank

The Malawi Savings Bank (MSB) has finally been sold to First Discount House (FDH) Holdings Limited, Malawi government’s preferred bidder committing to invest K9.5 billion including K5.4 billion for the existing shares.

Government has justified the sale saying the unanimous support to sale the bank was made by the Academia, Economics Association of Malawi, Banker’s Association of Malawi among others through various debates it conducted.

“It was, however, appreciated that any attempt to abort the transaction would deeply harm the financial sector and the would aggravate the country’s risk ratings.” Said Finance Minister Hon. Goodall Gondwe at the signing of the bank’s sale Thursday morning

FDH Holdings offered K5.4 billion in respect of 80% of the shares of MSB and claims the offer is far in excess of the bank’s net assets which the independent valuation done by ECAMA and Professor Ben Kalua, had placed at no more than K4.5 billion after excluding toxic assets.

Of the 80% shares to be acquired by FDH, 5% shall be sold to the staff and the 20% Government shares shall full ultimately be listed on the Malawi Stock Exchange for Public participation.

The total investment by FDH Holdings will consequently be; Purchase price for the shares- K5.4 billion, Capital subscription for Basil II-K3.20, Investment in ICT-K0.90 billion and the total investment is K9.50

“It is important to note that all the bids were prepared on the basis that the Government would hive off the off the toxic assets. Had the toxic assets remained in the bank, the offer price would have been significantly depressed.” Said Gondwe

Goodall Gondwe further said government has established a special purpose vehicle in order to optimize efforts of recovering the toxic debts owed to the MSB and that professionals have been appointed to recover the debts. He said those who may fail will have their assets confiscated and within six to one year the experts will have finished the the job.

Gondwe has further assured that MSB sale will “benefit from a more dynamic and innovative management through private sector participation and added that any further delays in implementing the sale may precipitate into untold arm on the economy, and may greatly undermine the integrity of Malawi’s system.”

Meanwhile, Inde Bank, has been sold to National Bank of Malawi (NBM)

The bank has been sold to a tune of K4.7 billion which is 67% of shares where by K1.6 billion is for the regulatory requirement for the recapitalization. And this sums to K6.3 billion.

MSB Sale Unstoppable Says Goodall As Parliamentary Committee Halts The Sale

Chiphiko listening to Petition on halting MSB sale

Malawi Savings Bank (MSB) sale will not be stopped confirms Finance Minister Hon Goodall Gondwe, amid adoption of the Budget and Finance Parliamentary Committee’s report  in the National Assembly which calls halting the sale of the Bank.

The Report was adopted on Wednesday evening by the house which asks recapitalization of the bank and sale it later if necessary.

Chairperson for the Committee Hon. Rhino Chiphiko when presenting the report noted that the sale of the bank is motivated by interest of very few business individuals connected to the ruling party including one major FDH shareholder Mr. Thom Mpinganjira.

He said the determination of the real value of the bank was a guess work as such the bank is going away on a giveaway price. Ina addition he said having one bidder which is FDH bank for such a big asset “Has heavily compromised on transparency and fairness of the process”

The committee said it was informed that the FDH bank had offered K4.9 billion for purchase of 75% shares in MSB.

After presenting the report which has been noted by the whole house on Wednesday, Chiphiko in an interview likened selling of the bank to FDH, to “Goat eating a Cow” as the bank is too small to buy the biggest bank in Malawi with number of branches across the country.

Chiphiko noted that since the house has adopted the report any process of selling the bank would be challenged in court by the house.

“The process of selling the bank should be floated on the Malawi stock exchange” said “I’ve been told that the stakeholders who would like to buy the bank are at the Capital Hotel to sign the papers, they can go on and sign the papers. But we’ve got the case here. Parliament will go to court because the report has been adopted by the whole house. And the house is the representative of all Malawians so the sale will be challenged if it continues” said Chiphiko

He said the committee also fear that the sale of the bank will lead to lay off of about 630 employees just like how previous privatized companies had done.

Chiphiko said the committee emphasized the need to recapitalize the bank with K4.5 billion that is required to make it stand on its feet so that it can meet Basel II requirements and possibly sale it after 3 to 4 years when it is in good shape and not at its weakest as it is now.

Meanwhile Minister of Finance, Economic Planning and Development Hon. Goodall Gondwe while describing reports that the bank has been secretly sold as of Wednesday ‘hearsay’, he said the sale of MSB is unstoppable what remains is when and how.

He said though government will go for analysis of what has been said both by experts and parliament but said selling the bank is the best recapitalization as alluded to the report and other calls being made since government will be free of any obligations of controlling the bank.

“The House did not stop the government from selling the bank, they noted the report and there was no vote passed.” Said Gondwe

“We are selling the bank because we are being forced by the Basel II requirement where we are considering the recapitalization of the bank. I expect that it will no longer be the responsibility of the government to constitute and meet the requirement of Basil II it will be the new management responsibility” he said

“All experts recommended that we should sell the bank and the only difference was when and how that should it be done and that was left for us to decide.” Added Gondwe

“In our case we have to decide when and how to sell the bank. If we don’t sell the bank the depositors will lose all their money is that what we want? Because the bank will find it difficult to find the money to pay the depositors when they want their money out if we don’t sale it. But we have an obligation to ensure that depositors do not lose their money”

Asked if he is afraid of the warning that the house will challenge the decision in court, Hon Gondwe said “No!, no, no, the courts are there for all of us to appear there, we will go to court and follow them, that is not a problem”

Malawi Sign Numerous Deals During MIF… Full Report Ready By Friday- Mwanamvekha

The Malawi Government describes its first ever Malawi Investment Forum (MIF) a 'success' having signed so many deals with foreign investors.

Minister of Industry and Trade, Joseph Mwanamvekha whose ministry has been coordinating to host the forum has since described the forum as huge success and promised ready to release full detailed and comprehensive report on the deals made in the Forum by Friday this week.

"Deals have been done, some of them (Investors) have just indicated their interest" said Mwanamvekha before the Communiqué was read out.

Mwanamvekha who was accompanied by three other ministers at Bingu International Conference Centre to deliver the Communiqué said close to US$ 1.5 million deals have been realized. He also said other deals will be made in the near future and at the time of issuing the Communiqué more discussions with investors were taking place and that some more will be happening in week's time.

He said other projects that investors have expressed interest require feasibility studies.

The Trade Minister boasts "From our perspective and from comments received, this forum was success because we managed to market Malawi"

He said investors managed to identify the opportunities and most of them were interested in Energy and mining sector, Infrastructure and Agriculture sectors.

Minister of Transport and Public Works, Francis Kasaila said he was impressed with number of interested investors in the transport sector including; Japanese Investment Institution Hitoch Corporation which is interested in number of projects; Elactra from Uganda interested Airport City in Lumbadzi, rail rehabilitation, marine and power projects among other number of investments and the company has promised to be back for more discussions in two weeks time.

"But the most important thing in the infrastructure sector is that we have been able to expose our local investors to financing institutions and in this regard the meetings we had with Economic Bank of Africa is one of them which has given the opportunities to local investors that they can send proposals and get financing and they have made it clear that they are ready to finance projects that are past with feasibility studies and we have number of projects that have gone past that." Said Kasaila

Taking his turn, Minister of Agriculture, Irrigation and Water Development, Allan Chiyembekeza said there is a investor interested in production of ethanol as well as production of glucose and starch from maize and that they are looking for huge quantities for maize.

The minister said discussions are underway and that once the deal is on, Malawian farmer will benefit much as the company is looking for quantities in excess of 350 thousand metric tonnes per year used to produce ethanol.

He said another company is interested in producing fertilizer and that another company from Zimbabwe, is interested to invest in chicken farming especially dealing with youth.

Unfortunately he said there was no investor interested in irrigation agriculture, "With the climate change problems we are facing in this country, I think we will be moving towards the intensification of irrigation agriculture." he then invited those with resources and interest to come forth and invest in this area.

Minister of Natural Resources, Energy and Mining, Bright Msaka said in Energy sector numerous investors have expressed interest as well. He said "I can say here and without hesitation that if we were to consolidate anything that we have received we will be fully satisfied to our energy need"

He indicated that some investors have expressed interest in providing financing in energy sector while others are interested in providing technical services in the sector.

Msaka confidently said "We created enough curiosity" by people interested in mining industry to come and explore more

"For many years Malawi has not been known as the mining nation, but we are the mining nation in view of amount of deposits that we have." Said Msaka who further assured the gathering and asked to spread the word that "there is enough minerals in Malawi to last us many years to come"

Malawi Investment Forum Begin Bearing Fruits MoreDeals Signed With Investors

The Malawi Investment Forum (MIF) ends with excitement to the Government as the outcome apparently begins to bear fruits following serious deals made with a lot of interest from numerous investors.

The Communiqué read at the end of the two day conference indicates that so far “three known deals have been quantified and offer over US $1.1 billion of investment” and that investors are coming up with serious investments promises to the country.