FDH Financial Holdings Limited, a financial services group which bought 80 percent stake in previously wholly-owned government bank, Malawi Savings Bank (MSB), says the merger between MSB and FDH Bank will be finalised in July this year.
In a statement accompanying summary of consolidated financial statements for the year ended December 31 2015 published on Monday, FDH Financial Holdings said the process of integration is going on well.
“The process of integrating MSB with FDH Bank in accordance with the directive of the Registrar of Financial Institutions is progressing very well and it is expected that the banks will be merged come July 2016,” reads the statement in part.
The merging of the two banks follows a circular to employees of both banks issued last September by FDH Financial Holdings chief executive officer Thom Mpinganjira which stated that the decision was to comply with the Banking Act of 2010, which prohibits dual control banks.
“Legislation does not allow for one bank to own shares in another bank, so FDH and MSB will merge into one bank, with one banking licence,” he said then.
The Competition and Fair Trading Commission (CFTC) already approved the merger of the two banks.
Majority stake in MSB was disposed of at the same time Malawi Stock Exchange (MSE)-listed National Bank of Malawi bought 97.05 percent stake in Indebank Limited.
CFTC is yet to approve the merger of the two financial institutions.
In an earlier interview, CFTC consumer welfare and education director Lewis Kulisewa said they were still investigating on the impact the merger on the economy.
The competition commission said that it had put aside NBM and Indebank merger application forms because they were yet to fulfill some requirements.
“National Bank of Malawi fulfilled all the notification requirements and investigations are at an advanced stage to assess the impact of the proposed merger on competition. As soon as investigations have been completed and a decision has been taken, we will make a public announcement,” he said then.