Clean-up underway: No former directors appointed on MauBank’s board

This Tuesday in parliament, opposition MP Kavi Ramano sought information regarding Maubank, how much money has the government spent on the bank; the capital adequacy ratio has been complied with; and whether the Bank of Mauritius has issued any directive as regards the ineligibility of the directors of the former Bramer Bank and the former MPCB  to hold any position within the new bank.

In his reply, Sir Anerood Jugnauth stated that government has invested an amount of Rs 1.3 billion in MauBank on 13 January 2016. “No further investment was subsequently made.” Last year, government invested Rs 1.05 billion and Rs 700 million in the former MPCB and the former National Commercial Bank, respectively. MauBank’s capital adequacy ratio was above the required minimum of 10% prescribed by the Banking Act 2004. Pursuant to Section 46 of the Banking Act 2004, no person can be appointed or reappointed as a director of a financial institution falling under the purview of the Bank of Mauritius unless he or she meets the test of being a “fit and proper person” as outlined in a guideline issued by the Bank of Mauritius in this regard. “No director who was on the last board of ex-Bramer Bank is presently on the board of MauBank Ltd. None of the directors who were sitting on the Board of the former MPCB as at 31 December 2014 is presently sitting on the Board of MauBank,” stated Sir Anerood Jugnauth. “The Bank of Mauritius not issuing any specific directive as regards the ineligibility of the directors of the former Bramer Bank and the former MPCB Ltd does not arise in view of the fact that the Bank of Mauritius has issued a Guideline on Fit and Proper Person Criteria applicable to all financial institutions falling under its purview.”

Gov declares war on malpractices

Dr Sorefan asked the Prime Minister whether he will consider amending existing legislations regarding toxic loans and the writing off of debts. Sir Anerood Jugnauth replied: “We will not tolerate any malpractices in banks and financial institutions, whether or not, government is a shareholder. We are determined to have a clean financial system and we are considering appropriate legislative amendments to plug any regulatory gaps as well as strengthening banking supervision.” A review exercise is currently being undertaken jointly with the IMF and the World Bank based on the recent Report of the Financial Sector Assessment Programme (FSAP) on Mauritius. Government will ensure that state-controlled banks comply with prudential guidelines. In this respect, the process for appointing Chairpersons, Directors and top management has been reviewed and will be improved further.