National Bank of Malawi (NBM) has outlined plans to establish a development bank after it completes the integration process with Indebank.
NBM bought 97.05 percent stake in the then government owned Indebank, after the latter failed to meet the Reserve Bank of Malawi’s (RBM) set minimum regulatory Capital and Liquidity Requirement.
NBM Chief Executive Officer, George Partridge, said during a cocktail reception the bank hosted to welcome Indebank customers in Blantyre that the bank still considers setting up a development bank as one of its priority agendas.
Partridge said, NBM will still revive its earlier plans to create a development bank as its subsidiary after acquiring majority shares in the bank.
“Appreciating the demand for the project and long term finance, we will re-incarnate the original mandate of Indebank as a development bank and long term arm or subsidiary of National Bank,” said Partridge.
He said already plans for the venture have gained momentum with capital also secured.
Meanwhile, Partridge said the acquisition of Indebank has proven to have had a significant impact to the country’s banking sector and the economy at large.
He said the whole financial system was worried about the consequences of the bank going down which created anxieties that it would imply complete failure of the system.
“If no institution was willing to take over Indebank, the bank had a few months to barely survive before it was going to literally collapse.
“A bank failure is the last thing you would want to happen to the economy, especially when it is already fragile,” he said.
NBM has since started rebranding the former Indebank branches countrywide.