Job losses loom at National Bank of Malawi

LILONGWE - National Bank of Malawi (NBM) could be set to axe a number of senior staff as it looks to reduce its operational expenses.

According to a circular seen by Nyasa Times signed by head of business resources Charles Dulira, the country’s biggest commercial bank, plans to cut jobs have been made by recent changes in the operating environment.

The Malawi stock Exchange (MSE)-listed financial institution has asked employees interested to proceed on the voluntary retrenchment arrangement to express their interest to the Human Resources Division by March 11 2019.

The bank has not disclosed how many of its employees it would like to go.

It is however dangling an “attractive” retrenchment package to entice more staff to apply.

According to the circular, the employees who will have their applications for voluntary retirement approved stand to get terminal benefits that will include severance allowance, notice pay, leave pay for accrued days, salary arrears for the applicable months of 2019 and a 40 percent lump sum from the pension scheme if one has clocked 60 years of age or has continuously worked for the bank for at least 20 years.

NBM has been able to make good profits during the country’s economic hard times. – NYASATIMES

– South Africa’s construction industry is being demolished. After 45 years of trading on the JSE, Group Five’s stock was suspended on Tuesday after the company filed for bankruptcy protection, making it the fifth local builder to enter business rescue in less than a year.

From a peak market value of R8.2bn in 2007, it was worth less than R100m when the shares stopped trading.

While the construction industry is notoriously cyclical, the current mix of a depressed SA economy, high levels of national debt and low infrastructure spending is proving toxic as contracts dry up.

At risk are thousands of jobs - including 8, 000 at Group Five alone - in a country with an unemployment rate of more than 27 percent.

“Those construction companies that are SA-orientated have gone from bad to worse in the past 12 months,” Marc Ter Mors, the head of equity research at Johannesburg-based SBG Securities, said.

“In SA, volumes are low, pricing is under pressure and companies are taking on more risk to win contracts, so margins are thin and that hits cash flow. There are no real segments to hide in.” Group Five’s history demonstrates the group’s resilience in “several extremely volatile markets,” the company still says on its website. Even so, it has “for some time, been experiencing cash flow difficulties,” it said on Tuesday.

Murray & Roberts (M&R) saw the writing on the wall. Having built significant SA landmarks such as the Carlton Centre, the continent’s tallest building, the company sold its building and infrastructure units in 2016 to focus on international businesses, centring on projects such as underground mining and oil and gas.

While M&R’s market valuation is a fraction of what it once was, the stock has gained 44% in the past year amid takeover interest from 40% shareholder Aton. The industry’s woes are a far cry from the build-up to the Fifa Soccer World Cup in SA nine years ago, which required major national infrastructure spend, including on new stadiums.

However, that boom was cast in a dark light even before the tournament took place, when the Competition Commission starting investigating collusion in the industry.

The regulator settled with 15 firms in 2013, while Group Five was granted immunity for co-operating.

While President Cyril Ramaphosa said last month that the government’s infrastructure spending has slowed, he also said the state will contribute R100bn into a fund over 10 years. - BLOOMBERG