BoN takes over SME Bank, top brass booted

The Bank of Namibia (BON) is with immediate effect taking over the reigns at SME Bank due to what BON Governor, Iipumbi Shiimi described as unsound investments made in South Africa.

Shiimi announced the development on Wednesday and said that the SME Bank Board has been relieved of their duties with an interim board set up to allow for proper investigations on the matter.

Shiimi said that following routine supervisory actions and investigations on the investments made by the SME Bank, the decision was taken to temporarily cease control of the bank.

According to Shiimi, subsequent questioning of the Boards members and several presentations made by the Board and Management of SME Bank Limited to the Board of BON did not prove satisfactory.

“At this point BoN is not satisfied with the information provided and is unable to render an objective opinion regarding the soundness or magnitude of the investments in question,” he said

“All assets, liabilities, business and affairs of SME Bank is with immediate effect under the control of the Bank of Namibia. The CEO, Manager of Finance and General Manger of Treasury have also been removed from their positions,” he added.

Shiimi said, control of the operations and affairs of SME Bank has been taken over by BON for an objective and thorough assessment of the investment portfolio of the SME Bank to make a full determination of the soundness of these investment.

Meanwhile he said, an interim Board will carry out the fiduciary responsibilities and support the committed staff member of SME Bank in managing the affairs of the bank on behalf of the BoN, until the temporary censure is lifted.

Head of Retail Banking and a member of the Executive Management team at SME Bank, Benastus Herunga has been appointed as the acting CEO.

The Minister of Industrialisation, Trade and SME Development, Hon. Immanuel Ngatjizeko in talks with BON management has assured them that Government is committed towards the sustainability of the bank.

The governor , meanwhile assured depositors that they will have full access to their money in the ordinary course of business. However, he urged all depositors to remain calm and not to withdraw their deposits as a result of this transitional period.

“Once the assessment of the investment portfolio is completed, the investments are secured and the potential risk to its stability is mitigated, the institution will be handed over to its stakeholders,” he concluded.