BY HENRY MCHAZIME
FDH Bank Limited, a subsidiary of FDH Financial Holdings Limited on Monday opened its doors for business, a development economic analysts say is good for the financial sector.
This follows an approval by Reserve Bank of Malawi (RBM) issued on July 15 allowing the bank to commence operations after meeting the security and operational standards.
FDH Managing Director Thom Mpinganjira, who has also been mandated to be the bank’s Chief Executive for a year, presented a premises inspection certificate number 0083 from RBM at a press conference in Blantyre.
Mpinganjira said the financial institution is currently serving Small and Medium Enterprises (SME’s) and corporate clients in an initial phase to roll out the bank.
“Earlier we registered as a merchant bank however our shareholders revised that decision that is why we are now FDH Bank and the next step would be to offer retail and consumer banking products through our branch by mid September,” said Mpinganjira.
He added that FDH Bank has submitted an application to RBM for an Authorised Dealer Bank (ADB) licence to allow trading of foreign currencies and opening forex accounts.
“In line with that goal we have partnered with corresponding banks in the continent and overseas these include Barclays Commercial UK, ABSA of South Africa, Mashreq Bank UK and First Rand of South Africa,” said Mpinganjira.
He added that the new bank would strive to offer loans to the public without requesting for collateral as it is the case in most southern African countries.
“We appreciate that most citizens cannot access loans because of collateral needs but we would like to serve the public as we strive to operate with an international touch so we have discovered better ways to give loans without securities as it is being done in economies within the region,” said Mpinganjira.
In reaction to this development Bankers Association of Malawi (Bam) said the bank would provide another base for economic growth.
“This means progress as a banking industry, we are growing and the public will have another point from the financial sector to achieve growth in the economy.
Above that Mr. Mpinganjira is one of the Malawians experienced in the financial sector so we are hopeful that more services are to be accessed from FDH Bank,” said Bam Executive Director Fanuel Kumdana.
Consumer Association of Malawi (Cama) Administration Officer Lawrence Nkhoma said the increasing number of banks would enhance competition in the industry and consumers stand to benefit.
“Consumers will have a wider choice of which bank to access services from and the banks would in turn offer various incentives to their customers, this is beneficial to the public in general,” said Nkhoma.
Financial market analyst Godfrey Jowah said the introduction of the new bank would enhance the drive by financial institutions to get closer to communities.
“The coming in of FDH Bank deepens the choice base for banking facilities for customers in the country as the bank would add the range of banking products on the market in the drive by the financial industry to get closer to communities.
The advantage is that FDH are already a player in the industry and they know market needs hopefully they are moving in to satisfy that,” said Jowah.
The coming in of FDH Bank brings the number of banks in the country to 10 after Standard Bank, National Bank of Malawi, NBS Bank, Opportunity International Bank of Malawi (OIBM), Nedbank, Ecobank, Malawi Savings Bank (MSB), Indebank, First Merchant Bank (FMB).
