Friday, March 1, 2024

Choppies application for a banking license turned down

Bank of Botswana has rejected an application for a banking license by Choppies Supermarket.

Together with a group of individuals, including former Minister Neo Moroka, former ruling party Deputy Treasurer, Paul Paledi and Dineo Saleshando, Choppies executive managers had applied for a banking license with Bank of Botswana.

If it had been approved, Tswana Bank would have been owned predominantly by the same people that own and control Choppies Supermarkets, by far the biggest chain in Botswana with a presence and growing footprint across the sub-continent.

The model was premised on using the wide rich of the stores as branches for the bank.
Right from the beginning things did not go well for prospective Tswana Bank.

Immediately after the application was submitted with Bank of Botswana, Paledi was charged with criminal corruption.

The applicants had to drop him from the list of directors and promoters if only to keep their chances of success alive.

As if Paledi’s troubles with the law were not enough, the application ran through yet another hurdle when, during the process, Bank of Botswana queried the involvement of a Finnish businessman who had been roped in as a strategic partner.

The Finnish owns a commercial bank in his home country. But the Bank of Botswana had been under the impression that the new bank, if approved would be wholly citizen owned.
Like Paledi, the Finnish businessman was sacrificed.

For sometime things appeared to be going the applicants’ way as Bank of Botswana escalated the application and asked the promoters to deposit P35 million as part of the license requirements.

In the meantime the Central Bank was doing a behind-the-scenes due diligence on the integrity of all the submitted individuals.

Things came to a head when the media picked the story that Dineo Saleshando was among the Directors.
Dineo is wife to Dumelang Saleshando, who is a Member of Parliament for Gaborone Central, a Botswana Congress Party President and staunch ruling party critic.

The media adopted a storyline that the BCP leader was hypocritical in his criticism of the Botswana Democratic Party if he saw nothing wrong with his wife teaming up with well known BDP stalwarts to create a bank.

For the BCP leader this was arguably his most difficult and trying political moment as it marked the end of a buddy-buddy relationship he had hitherto enjoyed with the media.
At another level, some members of his party called on him to resign.

While Dumelang Saleshando survived, the banking license lodged with Bank of Botswana by his wife and company did not survive.

Investigations by Sunday Standard have showed that the Central Bank summarily rejected the license immediately it was clear that one of the key promoters had had a brush with the law over twenty years ago, a brash that had resulted in a criminal record.

“One of them has had a criminal record. The issue of a strategic partner was of course raised, but the application collapsed on a single ground of past criminal record by one of the promoters. It was painful because the other parties were not aware that among them was a former criminal. They only got to know it when the matter was raised by Bank of Botswana,” said a source close to the application.

The Head of Public Affairs at Bank of Botswana, Andrew Sesinyi, has said that currently there are no banking licenses considered by the Bank. He would not shed much light on the intrigues and intricacies surrounding the Choppies application for a banking license.

“The law requires that information provided by applicants be treated in strict confidence except the publication in the Government Gazette of the name of the company that applied for a banking license.”

“Currently, the Bank does not have any applications for banking licences.”


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