Monday, May 16, 2022

FNBB denies loans freeze, admits strike will affect loan repayments

First National Bank of Botswana (FNBB) on Friday denied allegations that it had embarked on a loan freeze to striking civil servants.

The bank refuted claims by the Executive Secretary of the Botswana Secondary School Teachers Union (BOSETU), Justin Hunyepa, that its Mahalapye branch has begun the freezing of loans. 

The unionist said employees at the Mahalapye FNBB branch were declined issuance of loans because the bank assumed the current strike action by the five public sector unions was illegal.

He warned commercial banks that should they refuse to issue loans to their members, they will advise all their members to close their accounts.

“We will blacklist any bank that takes the approach. We have the capacity to have our own bank,” warned Hunyepa.

“The Bank has not taken any position to freeze application for loans by any public service employees on the strike. Guided by the Bank’s credit policy, an application for a loan is assessed using set qualifying criteria, therefore, every application case is assessed on its merits,” the bank’s Director of Marketing and Communications, Bomolemo Selaledi, told the Sunday Standard on Friday. The bank anticipates that the countrywide strike by civil servants will have a negative impact on its operations.

“The ongoing strike has effects on business and the entire economy. The “no work no pay” principle will lead to some of our customers defaulting on their monthly loan repayments,” he said.

There was a renewed  round of negotiations between the government and the five public sector unions on Friday after government had earlier issued a statement that it was pulling out from negotiations that have collapsed many a times.

The Unions have climbed down from their earlier request for a 16 percent pay hike to 12.5 percent. The government is offering 3 percent. The impact of the strike action on the economy has still to be quantified. The strike action by civil servants is the longest the country has ever witnessed in its history.


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