MAPUTO, Mozambique’s Central Public Ethics Commission, set up under the law on public probity, is to look into the takeover of Moza Banco by Kuhanha, the company which manages the Bank of Mozambique Pension Fund.

Moza, once the fourth largest bank in the country, ran into a liquidity crisis in mid-2016, and was in danger of becoming unable to meet commitments to clients. The Bank of Mozambique, the country’s central bank, stepped in, sacked the Moza board and appointed a provisional board to run the bank.

Since the Moza shareholders proved unwilling or unable to recapitalize the bank, an Evaluation Commission set up by the central bank sought bids from parties which might wish to take over the bank. Any successful bidder would have to show that it could recapitalize Moza with an injection of at least 8.17 billion meticais (around 137 million US dollars).

On May 31, it was announced that the Evaluation Commission had selected the bid from Kuhanha, and the Bank of Mozambique accepted this. Kuhanha was given a month to realize the promised recapitalization.

The new shareholding structure of Moza is 80 per cent for Kuhanha, and 20 per cent for the former shareholders (10 per cent for the Portuguese Novo Banco, and 10 per cent for Mocambique Capitais, a group of around 400 Mozambican investors).

The provisional chairperson of Moza, Joao Figueiredo, declared a Mozambican solution has been found, that will bring added value to the shareholders”.

“We didn’t bring in any support from outside. It’s entirely a Mozambican solution, he said.

However, there were immediate cries from some of the media that the takeover was a conflict of interests even though the Pensions Fund is not the same entity as the Bank of Mozambique, and Figueiredo insisted that the takeover was entirely transparent.

The spokesperson for the Central Ethics Commission (CCEP), Alfredo Gamito, said this week the commission will analyse the entire deal, and that it has requested detailed information from the Bank of Mozambique so that it can assess whether the transfer of ownership to Kuhanha violated any ethical principles.