NBS system collapses

Panic and frustration gripped customers of NBS Bank, one of the country’s four listed commercial banks, from Monday morning to mid-morning yesterday as customers were unable to withdraw money from their accounts.

NBS Bank management acknowledged the problem yesterday during a news conference at the bank’s head office in Blantyre.

Briefing journalists, NBS Bank chief executive officer Bernadette Mandoloma, flanked by the bank’s chief finance officer Dumisani Chatima, head of personal and business banking Mercus Chigoga and chief operations officer Martin Siwu attributed the chaotic scenes to a crash of its core banking system, but assured customers their funds were safe.

She said: “Our priority was to ensure that the system is fixed for our customers to transact. Our ICT [information and communications technology] team has been working tirelessly. Meanwhile, we are yet to establish the cause of the problem for it is the first of its kind.”

Mandoloma said the bank was taking a deep diagnosis of the problem to ensure that the situation does not recur.

Pictures taken by frustrated NBS Bank customers nationwide sent to Nation Publications Limited (NPL)) journalists from Monday showed helpless and restless customers seated on the floor at some service centres.

Spot checks yesterday established that NBS Bank did not open several of its service centres during the morning hours.

In the course of the problem, no one could withdraw money from automated teller machines (ATMs) or counters. Where possible, tellers only accepted cash deposits which they manually recorded.

One frustrated customer, Bizwayo Mvula, expressed disappointment with the bank, saying he wanted to withdraw money and settle utility bills to no avail.

Consumers Association of Malawi (Cama) executive director John Kapito described the situation as a “sad” development for customers.

He said: “This is a sad occurrence and has badly affected consumers. It has been costly and inconveniencing. We urge banks to ensure that they restore systems at least within an hour after breakdown and find alternative ways to serve their customers in a situation like this.”

But Bankers Association of Malawi executive director Lyness Nkungula, in her response to an e-mailed questionnaire, downplayed the situation. She said while customers were inconvenienced, the bank made efforts to resuscitate the system.

Said Nkungula: “This is one of those rare incidents and we are aware that not all services were down and that the bank was still able to take deposits and some ATMs were operating. The good part is that customers’ money is safe; hence, nobody needs to panic.”

However, the bank’s management said no ATM was operational after the system collapsed.

In a separate interview, Reserve Bank of Malawi (RBM) spokesperson Mbane Ngwira, while acknowledging that such occurrences are bound to happen in the banking system, emphasised the need for banks to have a sound risk management process to minimise losses caused during such occurrences.

Most of the country’s commercial banks are facing technological challenges with many ATMs, for example, overdeducting money from customers’ accounts, leading to queues of refund claims in many banking halls.

NBS Bank is owned 50.1 percent by Nico Holdings Limited, 26.3 percent by the public through the Malawi Stock Exchange (MSE), 18.1 percent by the World Bank’s International Finance Corporation (IFC), 5.2 percent by National Investment Trust Limited and 0.4 percent buy employees.

The bank has over 30 points of representation nationwide besides 15 off-site ATMs.