A bank that died more than 20 years ago has suddenly come back swinging — and it wants a massive chunk of Malawi’s money.
Defunct Finance Bank of Malawi, which was shut down in 2005 after the Reserve Bank of Malawi (RBM) revoked its licence, is now demanding compensation estimated at more than K2 trillion after securing a controversial Supreme Court ruling in its favour.
The staggering demand is so huge it could consume more than a fifth of Malawi’s national budget if the courts approve the payout.
At a time when Malawians are battling fuel shortages, endless blackouts, collapsing roads and skyrocketing prices, the idea of a dead bank demanding trillions from taxpayers has left many stunned.
The bank is seeking US$551.9 million for alleged loss of business and profits, plus another K61.7 billion in liquidated claims and accrued interest.
Finance Bank argues that RBM unlawfully destroyed its business when it suspended its foreign exchange operations and revoked its licence in May 2005.
In February this year, the Malawi Supreme Court of Appeal ruled that the revocation of the licence was unlawful and unconstitutional, opening the door for the bank to pursue damages.
The ruling shocked many Malawians and immediately triggered debate online, with some questioning how a bank liquidated two decades ago could now return demanding one of the largest payouts in the country’s history.
In documents filed before the Supreme Court of Appeal, the bank argues that it lost decades of growth, profits and business opportunities because of the licence revocation.
“Our assessment is that Finance Bank of Malawi Limited would have attained a market value of approximately US$352 million by 31 December 2025 had it remained operational,” reads part of the witness statement filed by financial expert Mkuzo Kenneth Kuwana of Kita and Co.
The filing further claims that the bank suffered “growth opportunity costs” and “reinvestment opportunity costs” running into tens of millions of dollars.
“The total damages for local banking activities alone amount to US$451.9 million,” the statement says, before arguing that another US$100 million should be added for lost international banking and trade opportunities.
The bank’s claim is backed by financial calculations prepared by Kuwana, acting as Group Financial Adviser to the Mahtani Group of Companies, owners of Finance Bank.
According to the assessment, Finance Bank made MK152 million profit after tax in 2004, equivalent to about 11 percent of National Bank of Malawi’s profits during the same year.
Using National Bank’s current market value as a benchmark, Finance Bank argues that if it had remained operational, it would today be worth hundreds of millions of dollars.
On top of the loss of business claim, the bank is also demanding over K61 billion for alleged remuneration wrongfully withheld, money allegedly used to offset claims, and damages for alleged breaches of employment contracts.
The demand letter states that the amounts should attract “interest calculated at prevailing commercial lending rates from 2005 to 2026.”
The respondents in the matter are the Reserve Bank of Malawi and the Attorney General — meaning any payout ordered by the courts would ultimately be carried by the Malawi government and taxpayers.
Should the court grant the request, it would not be the first time billions from Malawi’s public coffers have been dished out through the courts. During the explosive 2020 presidential election case, the opposition walked away with legal costs reportedly amounting to about US$9 million, roughly K7 billion at the time, after successfully overturning the election at both the High Court and the Supreme Court of Appeal.
Now the heat is back on Malawi’s judiciary.
Whistleblowers are demanding sweeping judicial reforms amid growing accusations of corruption and cartel like operations involving some senior judicial officials at both the High Court and Supreme Court of Appeal.
Leading the charge is outspoken lawyer and scholar Alexious Kamangila, who is currently pursuing a PhD in Ireland.
Kamangila is now locked in a legal war with High Court Judge Kenan Manda after accusing him of presiding over what critics call a deeply compromised commercial court system.
The allegations exploded further after a Malawi Law Society special inquiry uncovered what it described as “a trend” at the High Court Commercial Division in Lilongwe where “the outcome is usually a foregone conclusion in favour of those members’ clients.”
The explosive report identified Justice Kenan Manda and Assistant Registrar Anthony Kapaswiche as alleged “master minders” of what investigators described as an organised scheme involving certain lawyers, law firms and suspicious court processes.
Investigators further alleged there was “bias and general favouritism” toward particular lawyers, alongside rushed judgments, intimidation of witnesses and enforcement orders allegedly issued before legal deadlines expired.
With a dead bank now demanding a huge chunk of Malawi’s national budget, many Malawians are once again asking whether the country’s courts are turning into billion kwacha battlefields where explosive decisions are quietly engineered behind closed doors.
Among the leading legal teams representing Finance Bank is lawyer Wapona Kita, whose law firm was also named in the explosive Malawi Law Society inquiry report into alleged misconduct and cartel like operations at the High Court Commercial Division in Lilongwe.
In the bombshell findings, the Malawi Law Society inquiry stated: “The Committee has found that largely, four lawyers and their legal houses are the kingpins of the scheme. These are in order of their seniority at the bar:
(a) Counsel Emmanuel Theu of Lexon and Lords
(b) Counsel Gift Nankhuni of G. Nankhuni and Partners
(c) Counsel Edgar Kachere of Whyte and Cross Law Consultants; and
(d) Counsel Wapona Kita of Kita and Company.”
The report went even further: “The Committee has found that most of the cases subject of the complaints were personally undertaken by the aforementioned Counsel, with a few cases taken up by associates in the firms. This was particularly the case in the firm of Messrs Kita and Company.”
Investigators also alleged the existence of proxies allegedly used in some court cases. “The Committee however found that in some instances, the matters were undertaken by other lawyers who are strongly believed to be proxies of the four lawyers mentioned above. There is a trend where the perceived proxies would commence cases and the four lawyers mentioned above would join the cases at one point or literally show up in Court during hearing and argue the cases together with the suspected proxies”.
The report added: “In this instance, the Committee has found that Counsel Geoffrey Taumbe and Khwima Mchizi have been working closely with Counsel Gift Nankhuni while Counsel Zwelithini Chipembere has been working closely with Counsel Edgar Kachere. Counsel Zwelithini Chipembere, Geoffrey Taumbe and Khwima Mchizi are suspected to be proxies in the scheme.”
The explosive findings and the trillions demanded by Finance Bank is intensifying scrutiny around judiciary at a time taxpayers could potentially be exposed to one of the biggest compensation payouts in the country’s history.
