National Bank of Malawi (NBM), the Malawi Stock Exchange (MSE)-listed financial institution, says it is conducting feasibility studies on the viability of establishing a development bank next year.
Speaking in an interview on Thursday in Mzuzu, NBM chief executive officer George Partridge said the bank has been approached by several development banks for possible deals; hence, the idea to establish a development bank.
He said this when the bank held a cocktail to welcome Indebank customers in the Northern Region.
Earlier this year, NBM bought 97.05 percent stake in Indebank, which meant that all operations of the bank were integrated into NBM. The remaining 2.95 percent stake is held by erstwhile employees of Indebank under the Employee Share Ownership Scheme (Esos).
Said Partridge: “So, what we intend to do is not only us to pump money into the development bank, but to act as agents. Some of you might have read in the papers that we have just concluded a deal worth 30 million euros [K24 billion] with European Investment Bank [EIB].
“We would like to bring in these development banks and channel their money through that particular vehicle. We have been approached by so many of them. We have been saying no to most of these moneys in the past and we have lost a lot as Malawi. We think we can channel these moneys into this particular vehicle to provide long-term financing.”
Indebank, which derived its name from Investment and Development Bank of Malawi Limited, was established in 1972, as a development bank.
In 2001, the bank transformed into a commercial bank after obtaining a commercial banking licence by the Reserve Bank of Malawi (RBM).
Partridge said the establishment of an investment bank will necessitate long-term financing, but also bring in huge sums of money that the country is losing out due to lack of such banks.
One of the bank’s customers, Charles Banda, hailed the idea of establishing a development bank, saying it shows that NBM is innovative and committed to developing the country.
He said the bank will impact on the economy as the country will access huge sums of money from other countries for development purposes.n