The Malawi Savings Bank sale, a heist gone bad

If you still think there are only seven classic wonders of the world, you have another think coming. Ladies and Gentlemen, it is my singular honour and pleasure to introduce to you, the eighth wonder!

Please, join me in welcoming and inducting the eminent and learned buyer of MSB – Today’s People’s Bank, the eighth classic wonder of the world! 

(round of applause, and champagne flows) 

His wonder of wonders is that FDH Holdings Limited is demanding back K1.1 billion from the amount it paid for Malawi Savings Bank (MSB) shares on grounds that the company was overvalued

Treasury’s reaction is that the claim is as ridiculous as a eunuch fathering twins, and of course will have none of FDH Holdings’ nonsense. 

“Our view is that FDH was given ample time to conduct due diligence and assess the deal before deciding to buy the shares [in MSB]…government is rejecting to take liability of their claim,” the director of debt and aid management Madalo Nyambose spelling out the basis of government’s rejection for liability as stupidly claimed by FDH. 

While Treasury has given its reasons for its reaction, i.e. the buyer had ample time for due diligence before signing the deal; there are several other reasons under both common law and common sense which, somehow, has deserted Mr Thom Mpinganjira. 

First and foremost, any one who has studied law even at the elementary level, knows the maxim Caveat emptor.  

That is to say, Mr Thom Mpinganjira, who told us off in his spirited defence of the deal, claiming to be an authority and a professional in this area on top of being a chartered accountant, should have done his homework properly.  

“I should know better because I am an accountant by training. I spent five years at the University of Malawi studying accounting and valuations we do from first year. I am a chartered accountant that means I spent three to four years studying UK chartered accounting and I have worked in audit and I have worked in private sector and we have bought and sold shares as FDH. 

“If you are not an expert don’t get involved. Valuation is something that takes years to understand. Now I am surprised that there are people that are masquerading as experts,” he said. 

But by the look of things, his years at the University and those spent studying what he called chartered accounting, were wasted. His grades in valuation ought to be reviewed because he now admits that, as we had all feared, he made a huge mess of the MSB valuation. And shooting himself in the foot by doing a botch job should not cost us, the tax payers, even a cent. 

Secondly, another well-known maxim says Ex turpi causa non oritur action, i.e. he who comes to equity, must come with clean hands.  

And Ladies and Gentlemen, the fact that Mpinganjira and his pal Goodall Gondwe bulldozed the deal while our representatives in Parliament were resolving to pend the sale, means that he lost all moral ground to come back to us with the nerve to ask for a billion or any amount whatsoever. 

He should have exercised more patience and caution befitting a person of the calibre he purported to be. Had he been patient, perhaps what he has only known now, he would have discovered then and either negotiated a better deal or left the Bank we loved to us. 

In the unlikely event that he has indeed lost out on the deal, then he only has himself and his conspirators to blame. 

By the way, who told him that buying a bank against public will entitles him to draw billions at his whims from the Treasury? 

I for one have not forgotten that MSB towards its demise, was posting impressive profits. If he has gutted it and it is now bleeding, he cannot hold us all to a billion-dollar ransom, no ways. 

If truth be told, Mr Mpinganjira risked coming out badly by getting involved in that act of thuggery and looting of public property.  

It is common knowledge that you cannot swim with pigs, no matter how respectable they look, and come out smelling as if you have had a shower of Hugo Boss perfume, no. 

You swim with swines, you end up stinking. 

Now by concocting this ridiculous claim, he is coming out even worse than I feared.  

First, those who were trusting his judgement, are now asking questions and secondly, those who were advising him against making a deal clothed in secrecy in a rush – on a subject with red lights flashing all over – are now telling him, we told you so. Believe you me, nothing beats at the wrong end of an ‘I told you so’. When told that, you easily believe that you are the biggest fool in the universe. 

Now to make a u-turn, almost a year after buying a 75 percent stake in the hitherto wholly-owned State bank in a K9.5 billion package on July 2, 2015, when the Malawi govt had just issued a K6 billion promissory note to clear toxic assets, behind our back with the patently silly pretext that the bank was overvalued, is surprising. 

According to one economist, using any pricing model, the K4.5 billion quoted for MSB was an under-valuation and it was of no value to the shareholder. 

In fact, we, the owners of Malawi Saving Bank, already lost MK1 billion in that sale. Here is the how: 

The Economics Association of Malawi and Professor Ben Kalua of Chancellor College valued the bank at K4.5billion, excluding the toxic assets. But somewhere in April 2015, Treasury issued a K6bn promissory note to write off the toxic assets off MSB books, meaning that at the time of buying, the bank had no bad loans to write off. By collecting K9.5bn from FDH Holdings after spending K6billion, the real sale price is K3.5bn and not K4.5 billion as valued by our good economists. 

Therefore, Mpinganjira should not insult Malawians, the real victims of his deeds, after peeing in our faces last year. 

He laughed first, he should have the decency to let us thoroughly enjoy our long-lasting laugh. 

Any advice to Mr Mpinganjira? 

I am very magnanimous even in victory, so, yes I have some counsel for him. The eminent banker should stop sulking, grow up and move on. 

I could stop here but knowing that in Malawi we have an exceptionally long list of idiots, signing off without dispensing general advice would not only be treasonous, but unpatriotic too. 

Have you taken note of how Mulli has all over a sudden gone quiet? Remember he used to sport a diplomatic passport back in the day? Grabbing land at will all over the Lhomwe Belt? 

Take it from me, he is now wiser. He saw that picture with a caption which reads: when you are in deep shit, shut your mouth and look straight ahead; and now behaves advisedly. 

Is there anyone who can have already forgotten Oswald Lutepo, who used to be a VVIP? Where is he now? 

Come to think of it, Mr Mpinganjira should thank providence for this lesson of life. While it is painful coming at his age and at the back of his litany of qualifications and experience, it is sheer luck that there is no prison beckoning him like Lutepo. He should therefore take the billion Kwacha loss as a man and move on. 

And for those on the waiting list to be duped by Malawi’s mafia-like ruling elites, you have been warned. 

You can look cool for a while, but it’s never long before you end up either in cooler like Oswald or like the very learned Thom Mpinganjira FCCA, blah blah, a billion short in broad day light. 

As a last word, a free piece of advice to the President Peter Mutharika, who sold the bank behind our backs: I do not want to hear even a rumour that Mpinganjira’s stunt is a conspirancy to rob us of yet other billions.  

The moment I get a whiff of that, we will rumble. 

I rest my case. 


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