Teachers’ investments headed South as Spire bank is on the spot again

Spire bank, a bank largely owned by teachers is on the headlines again all for the wrong reasons. It should be noted that all along the teachers have been against the acquisition of the bank but contrary to their wishes the top management of Mwalimu National Holding (MNH) still controls the bank. MNH spent over 2 billion in order for the bank to meet the minimum capital requirements to operate. The capital injection has now become a norm with the teachers who have invested in the Mwalimu National Sacco continue to receive reduced dividends on their investments.
According to the business daily, the bank has already recorded a loss of 254.7 million in the first quota of this year which already projects a negative impact on the teachers' dividends this year. It is the members' prayer that the bank won't be placed under receivership by the Central Bank of Kenya (CBK) which will mean that the members won't access their savings but will be required to be servicing their loans.
In a letter to the members of the Mwalimu National Sacco dated June 3rd, 2020, the Sacco confirms to the members that it is aware of the misfortunes of the bank but there is no turnaround strategy on the table as at now. The Sacco blamed the Covid-19 pandemic on slowing down the strategies that could have been put in place to save the teachers investments.
Early this year the CEO of the bank, Mr. Onesmus Muia was suspected of practicing unethical behaviors. In the accusations it was alleged that Mr. Muia was working unlawfully with law firms to raise fabricated fees against the bank which will then be sent to Mr. Muia's personal bank account at Family bank in Ruiru. As at the third week of January, Mr. Muia's bank account had over KSh. 76 million. For more on that story click here.
Lastly it should be noted that the members are systematically losing grip with the Mwalimu National Sacco. A good example is the Nyamira branch. After the lapse of the term of four delegates representing the members in the Sacco, the branch has been unable to replace the delegates or mandate them to continue representing the members. That means the branch is operating short of four delegates bearing in mind that the term of three other delegates is lapsing this year.
Now teaches are a worried lot that if nothing is done urgently, things are headed South.
Compiled by;
Erwin Mogusu
omogusu@gmail.com
www.omogusu.blogspot.com