Kuhanha, Central Bank Pensions Fund takes over Moza bank

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Kuhanha, Central Bank Pensions Fund takes over Moza bank

5:19 CAT | 31 May 2017

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Kuhanha, the company that manages the Bank of Mozambique’s pension fund, is the new majority shareholder in Moza Bank, which has been under central bank intervention since September 2016.

Moza Bank suffered a liquidity crisis in mid-2016 and was in danger of being unable to meet its obligations to its clients. The Bank of Mozambique stepped in, sacked its board of Directors, and installed a provisional board, under the chairmanship of one of the country’s most experienced bankers, Joao de Figueiredo.

The task of the provisional board was to ensure the recapitalisation of Moza, which required an injection of a minimum of 8.17 billion meticais (just over 137 million US dollars, at current exchange rates).

The existing shareholders, Mocambique Capitais (a grouping of about 400 Mozambican investors) and the Portuguese bank Novo Banco, proved unable or unwilling to capitalize the bank, and so an Evaluation Commission, set up by the central bank, received bids for Moza from other bodies interested in running the bank.

The Commission unanimously selected the bid from Kuhanha, and forwarded it to the central bank.

At a Maputo press conference on Wednesday, Alberto Bila a member of the Bank of Mozambique board, declared that Kuhanha met the requirements to recapitalise Moza, and so its bid has been accepted. It now has a month to realise the promised recapitalisation.

Bila said that Kuhanha has “a sound and prudent management”, and he was confident that it would be capable of running Moza.

Under the new shareholding structure, Kuhanha holds 80 per cent of Moza. The existing shareholders retain the other 20 per cent – 10 per cent for Novo Banco and 10 per cent for Mocambique Capitais. One individual shareholder, Antonio Almeida Matos, maintains a shareholding of 0.01 per cent.

The shareholders have confirmed Figueiredo as chairperson of the Moza board.

Neither Bila nor Figueiredo were prepared to reveal who else put in bids for Moza. However, a recent article in the independent newssheet “Mediafax” claimed that Barclays Bank, the French Societe Generale and the African Bank of Morocco were interested in taking over Moza.

The rationale for setting up Moza, in 2008, was that this would be a bank in which the majority shareholding was Mozambican – Mocambique Capitais held 51 per cent of the shares and its Portuguese partner 49 per cent. Under the new arrangement, Mozambican bodies now own 90 per cent of the shares.

“A Mozambican solution has been found, that will bring added value to the shareholders”, Figueiredo declared. “We didn’t bring in any support from outside. It’s entirely a Mozambican solution”.

At the time the central bank stepped in, Moza was the fourth largest commercial bank in the country. It held 8.9 per cent of the assets in the Mozambican banking market, and 7.6 per cent of all deposits.

Figueiredo admitted that immediately after the central bank intervention, Moza lost market share slipping to “fifth or sixth position among the commercial banks”, since, despite an injection of funds from the Bank of Mozambique to keep it afloat, it remained undercapitalised. It was also recovering from what he described as a “chaotic” situation uncovered by an audit of September.

Nonetheless, Moza continued to expand, opening branches which had been built under the previous management, but then mothballed.

It is unclear whether Moza will keep its name – Bila said that any “rebranding” of the bank must be decided at a general meeting of the shareholders.

Source: AIM