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Home / NEF in bid to rescue its N$400 million from SME Bank
NEF in bid to rescue its N$400 million from SME Bank
2017-07-13Staff Report 2 Desie Heita Windhoek-The National Energy Fund (NEF) – which has invested N$400 million in the newly liquidated SME Bank – may struggle to get its money back after revelations in court this week that the bank only had N$25 million on its books. Of the N$400 million, there was N$177 million in a call account. The balance was in a fixed deposit account that was set to mature in October this year. The government uses the energy fund to subsidise the price of fuel in the country by equalising fuel prices when the prices of oil in international markets are too costly for Namibian consumers. The fund also pays out the road delivery subsidy for transportation of fuel to rural and remote areas of the country. It emerged that the fund tried to withdraw its money after the Bank of Namibia asked the High Court to finalise the winding up of SME Bank. This came out in court documents, with the governor of the Bank of Namibia, Ipumbu Shiimi, using the NEF as an example to fend off claims by the Zimbabwean minority shareholders in SME Bank against closure of the bank. Shiimi said the fund had wanted to withdraw its N$400 million but the bank only had N$25 million. He added that the reason for urgently asking – and subsequently being granted – the winding up of the bank was to appoint liquidators who would “be in a position to take charge of the business and assets and to realise the business and/or assets for the benefit of SME Bank’s general body of creditors.” It is not only the energy fund that tried to withdraw its money. Yesterday individual depositors kept popping up at SME Bank’s main branch in Windhoek, and when finding shut doors, they attempted to withdraw their money through the ATMs, which were also shut down immediately after the appointment of liquidators on Tuesday afternoon. The security officer stationed at the bank had to assume the role of a banker, explaining to exasperated clients why they could not withdraw any money, even from the ATMs. Shiimi had also, interestingly, pointed out to the court during the hearing that resulted in the liquidation of the bank, that the minority shareholders in the bank never attempted to refute the claim that the bank is bankrupt. “There is not a single denial, even general or bald, that [SME Bank] is insolvent. This, with respect, is telling,” he said. A part of the documents that Shiimi put before the court is a damning affidavit by the chief executive officer of Johannesburg-based Mamepe Capital, Mauwane Kotane, in which he listed the accounts of 11 unknown entities that purportedly hold more than N$188 million – including interest accumulated – on behalf of SME Bank as of May 2017. However these investment entities – with such exotic names as Moody Blue Trade, Grenada Investments, Rustic Stone, Technical Assignments, and Transparency.com – did not have investment contracts with SME Bank. Neither were they transactions that are allowed by the regulations of the Bank of Namibia, Shiimi told the court. Kotane made the revelation in a deposition to the South African National Prosecuting Authority, which had subpoenaed all South African institutions that have touched SME Bank money. The subpoenas were issued at the request of Namibian Police Inspector-General Sebastian Ndeitunga. Kotane had however denied any irregularities in the transactions, saying: “It is both disingenuous and unfortunate to allege that the funds form part of an investigation of fraud, theft and contravention of Prevention of Organised Crime Act, when in fact SME Bank is in possession of all the agreements as well as correspondence between ourselves and in relation to this transaction.” 2017-07-13Staff Report 2
