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AfricaMoney | June 28, 2017

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Mauritius to create new lender ‘National Commercial Bank’ to take over Bramer

Mauritius to create new lender ‘National Commercial Bank’ to take over Bramer

Speaking at the Parliament yesterday, Mauritian Finance Minister Vishnu Lutchmeenaraidoo noted that the National Commercial Bank, formed to take over Bramer Bank, will be given an operating licence by the end of this week. (Image: leboncoin.nu)

Mauritius will create a new company called the National Commercial Bank to take over Bramer Banking Corporation Ltd (BBCL), following SBM’s decision not to go ahead with the purchase of Bramer Bank.

Speaking at the Parliament yesterday, Mauritian Finance Minister Vishnu Lutchmeenaraidoo noted that the National Commercial Bank will be given an operating licence by the end of this week.

Last week has been turbulent for the island economy’s banking sector, seeing as it did the revocation of Bramer’s banking licence on Thursday, 02 April 2015, with the central bank citing “public interest” as a reason to crackdown on the local banking major, which has been operating in the island economy since 2008. Following the banking licence revocation, Bramer Bank saw its shares being suspended for trading on the Stock Exchange of Mauritius on Friday, 03 April 2015.

The central bank was alerted to deep-rooted issues at Bramer Bank due to large deposit withdrawals that had placed the bank in a “precarious liquidity situation”, due to which a collapse of the bank could have been imminent.

Thereafter, the banking sector was further placed under the scanner as Prime Minister Anerood Jugnauth declared last Friday that Bramer was likely involved in a Ponzi scheme, implicating parent company BAI as well.

The government promised to take strict steps and assured the bank’s customers that an investigation is under way into what is now being referred to as an unprecedented financial scandal that could be in excess of Rs 25 billion, affect as many as 23,000 customers as well as place 160,000 insurance policyholders at risk.

Meanwhile, the ripples of the financial scam in the island economy are spreading across to the African mainland, with Kenya based money management firm British-American Investment Co (Britam) assuring the investing public that while it has directors in common with financial companies BAI and Bramer Bank, it is “an independent legal entity.”

As to linkages between Kenya-based Britam and Mauritius-based BAI, it may be noted that British-American (Kenya) Holdings Ltd, which is a 23.34% shareholder in Britam, also happens to be related to BAI. After disclosing this linkage, Britam also assured investors that Bramer isn’t a shareholder of Britam.

Even as common directorships exist between Britam, BAI and Bramer Bank, (including billionaire Dawood Rawat and two relatives), Britam noted that it is managed through “an independent board of directors and management,” putting to rest any allegations about other relationships between Britam, BAI and Bramer Bank.

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