About three years ago, Mwalimu Sacco pumped in Sh2.4 billion to acquire Spire Bank, previously known as Equatorial Commercial Bank, from businessman Naushad Merali.
Buying a limping and wobbling bank is like buying second-hand clothes. Otherwise, why would a financial guru sell a profitable and thriving bank?
In the year ending December 2018, Spire Bank sank deeper into the red after reporting Sh2.2 billion loss. The bank’s assets also fell by Sh1.9 billion or 17 per cent to Sh9.2 billion.
The rest, as they say, is history and for teachers themselves. Territorial disputes among counties should also not be downplayed in whatever adventures and misadventures they partake.
I am afraid the same will repeat itself, if not worse, with any of the six regional economic blocs that want to acquire banks for whatever purposes. I have no doubt that already confirmed corrupt county officials will only acquire limping banks. Thriving and successful banks will not let go of their decades of investments.
Counties’ leadership should not waste taxpayers' resources in acquiring “mitumba” banks. They should start their own new banks if they have sufficient resources to do so.
Last but not least, I congratulate MCAs from the Lake Region Economic Bloc who have repeatedly shot down budgets with Sh200 million as their contribution to start a bank that has ab initio aborted. Counties that spend about 85 per cent of their revenue allocations to pay salaries as opposed to development are hundreds of miles away from running banks. They should put their houses in order and produce their own food before they think of starting banks.
Sages say that only fools learn from their own mistakes. If the current county leadership are not composed of fools then, the six and all the regional economic blocs should learn from Mwalimu National Holdings Ltd that will soon go to the dogs with their multi-billion acquisition of Spire Bank.
