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Two engaged to recover MSB ‘toxic’ loans

 

Government has set up a yet-to-be-named independent agency to collect outstanding loans owed to State-owned commercial bank, Malawi Savings Bank (MSB), which is up for sale.

Well-placed Treasury sources confided in The Nation that two of the individuals earmarked for the job are Chadwick Mphande, former chief executive officer of Carlsberg Malawi Limited who also serves as a director of NBS Bank and chartered accountant Nkondola Uka, a managing partner in accounting, audit and business advisory firm Deloitte.

The MSB head office complex in Blantyre
The MSB head office complex in Blantyre

The sources said the strategy is for the team to collect the debts owed to MSB to demonstrate that government was not bailing out the politically linked debtors.

Two weeks ago, revelations by The Nation that government had taken over MSB’s toxic loans worth K6.4 billion (US$14.2 million) owed by politically linked companies and individuals, including Mulli Brothers Limited (MBL) Holdings, attracted public anger.

Minister of Finance, Economic Planning and Development Goodall Gondwe could neither confirm nor deny the said appointments when contacted in Lilongwe on Wednesday.

Earlier this year, government through the Public Private Partnership Commission (PPPC) invited bids from strategic investor to buy its stakes in MSB and Indebank Limited which it partially owned.

Through the transactions, government wanted to, among other things, ensure that MSB and Indebank met new Basel II regulatory requirements in terms of capitalisation.

National Bank of Malawi (NBM) has since been named as a the preferred bidder for Indebank while FDH Financial Holdings Limited—owners of FDH Bank—was the sole bidder of MSB, but the deal is facing resistance from several stakeholders, including opposition parties, civil society organsations and more recently concerned MSB employees.

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