Opposition resists report on Banking amendment Act

DPP LEGISLATORS IN A JOYOUS MOO

A motion asking members if debate on a report of the Banking amendment Act was defeated after the opposition insisted they be given chance to voice their reservations on the bill with 84 votes against government’s 73 and 36 abstaining.

Among others, the bill is looking into the issue of failing banks as currently there is no law which handles this matter hence the Reserve Bank of Malawi (RBM) coming up with the bill and to instill confidence in the banking sector.

The Budget and Finance Committee met several stakeholders such as Ministry of Finance, the central bank, Attorney General and Bankers association of Malawi and came up with a report which was presented to the house.

However when the report was presented in the chamber, it was apparent the opposition side was not amused with some of the proposed amendments.

Key issues pointed out by the Budget and Finance Committee include the bill suggesting that someone should not be acting directly or indirectly to become a shareholder of a company.

According to Committee Chairperson Gladys Ganda, there isn’t any explanation as what acting directly or indirectly means and to remove that ambiguity, the Committee thought nobody should become a shareholder or majority shareholder without approval of the central bank or the Registrar.

She reasoned that at the end of day, the Registrar is the one that approves all the major shareholders hence it’s not proper to bring micro issues into the law.

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Ganda: Is the Registrar above the Constitution? So people are saying no.

Ganda explained that the Committee has given mandate that nobody should come controlling shareholder without the central’s banks’ approval and that whatever they do thereafter, its none of its business but at least there must be an approval from the bank or the Registrar.

 “The second one is a case whereby shareholders where dividends are warehoused; the bill now proposes that when dividends are warehoused, the owner of those shares should not be able to get the dividends so people are saying that the dividends should apply even when they are warehoused at least the shareholder himself or herself should be able to have access to those dividends because that’s an investment it’s not a loan.

“It’s an investment that someone has done, so if a shareholder has done something wrong or has an issue at the court, their shares should be able to get dividends. The other issue that is also critical is on the issue of the court themselves. The bill is proposing that even if something goes to court and the shareholder has got an issue in the court and he’s been acquitted by the court , even if the court acquits the shareholder,  the law is proposing that still Reserve bank is above that acquittal by the court.

“So we’re saying that is unconstitutional because if the courts say that the shareholder is acquitted; there is nothing wrong that he did, obviously it means that everything else that was removed from him or her should be given back to her; but the Registrar is saying no no I still have to make a decision on that one. What are we saying? Is the Registrar above the Constitution? So people are saying no."

She insisted the Committee came up with a very good report adding it comprises members from the opposition and also government side; with only five members from the opposition and 16 members from the government side.

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A joyous Navicha dances after the defeat 

The Committee Chairperson stressed that it did a professional job to make sure that it should not come up with a bad law but rather one that would serve Malawians better.

Mulanje Bale legislator Victor musowa stated that the bill Infringes on the rights of Malawians, as the Registrar is given more powers equating him to a God.

Ntcheu west parliamentarian eminded members they were elected on people’s trust hence need to make laws which people support arguing the bad laws will one day haunt them and stressed on the need to legislate laws which are in favour of the public.

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Oposition legislators conferring on the matter

Chipping in, Malawi Congress Party’s Peter Dimba indicated that the bill was developed a number of years ago and that out of eight banks consulted seven agreed to the amendments. 

Despite Justice Minister Titus Mvalo assuring the bill isn't targeting any bank, the members of the opposition still continued to voice their reservation on the proposed legislation.

After Parliament was adjourned, Leader of the opposition Kondwani Nankhumwa appreciated the members for the gallant fight and urged them not to relent.

He described the bill as an important one with a lot at stake and urged them to come up in large numbers until the fight is won and advised them to be on the lookout as he’s gotten intel government wants to buy some of the opposition lawmakers.