My conscience is clear - Simaata

11 August 2017 Author   Sonja Smith and Chamwe Kaira
Secretary to Cabinet, George Simataa, believes that the N$200 million that the SME Bank “invested” in South Africa would not have been lost had the Bank of Namibia (BoN) not removed the board he chaired.
In an exclusive interview with the Windhoek Observer this week, Simataa said the collapse of the SME Bank is not something that worries him, although he is deeply concerned with the over 200 employees that lost their jobs.
He explained that under his chairmanship, the SME Bank was still solvent with a capital position in excess of 68 percent of the required regulatory minimum levels and surplus liquidity position of 155 percent above the statutory minimum.
“It is necessary to state that, during the tenure of the Board of Directors that was removed by the Bank of Namibia, no money was found to have been lost. Similarly, I have not seen an official investigative report that confirms that the SME Bank Limited lost N$200 million through questionable investments outside the country.
“Naturally as a responsible and accountable leader, the board would have taken corrective and preventative steps to mitigate any loss, in the event where such loss was detected, but this is not the case here. This is so because these investments were done with the approved delegated powers of management,” Simaata said.
He added that the SME Bank was only liquidated after the Bank of Namibia had removed the Board of Directors that he chaired and appointed other persons as board members.
“Prior to 01 March 2017, the SME Bank and in particular before the Bank of Namibia assumed control of the SME Bank Limited, the SME Bank was at all material and relevant times solvent. This is contained in a letter from the Governor of the Bank of Namibia to the Minister of Industrialization, Trade and SME Development dated 6 March 2017,”Simataa said.
He said as a non-executive chairman, he could not have made decisions on investments as this was not part of his mandate.
“I did not become the chairman of the SME Bank at my request. The minister of trade appointed me with the concurrence of Cabinet as a non-executive chairman by virtue of my position as Cabinet Secretary.
 “It is not correct to suggest that millions of dollars went missing under my watch. I was chairperson of a board of directors that had collective governance responsibilities. The board itself did not, either in a meeting or by circulation, make any investment [decisions].
“Management in the normal cause of business made investments within their delegated powers over a period of time with Mamepe Capital (Pty) Ltd and VBS Mutual Bank. In this regard, it is important to note that the management of the SME Bank Limited signed valid and binding Investment Agreements with these two entities,” he said.
He added that anyone who calls him corrupt over the lost N$200 million at the SME Bank should question why he has not been prosecuted or sent to jail.
“I am at peace with myself. However, as a responsible citizen I am equally deeply concerned with the hopeless situation of over 200 employees of the SME Bank Limited, who face a dark future and economic consequences that result from the manner in which the SME Bank Limited matter was handled.
However, I must categorically state that my conscience is very clear, as any investigation will undoubtedly exonerate me from any liability.”
Simataa questioned why the Bank of Namibia did not detect the transfer of the N$200 million to South Africa, and yet expected him, a part time employee, to detect it.
“It is very strange that you are ignorant of the role of the Bank of Namibia as a regulator of financial institutions and how the Bank of Namibia allowed large sums of money to go out of the country unnoticed as it has a legal obligation to detect transactions of such nature.
“This is the point His Excellency the President of the Republic made at his Press Conference on Monday, 31 July 2017 when he questioned: ‘How can such money leave the country and the Bank Supervisor with all the instruments could not detect it, yet expect part-time people to have detected it?’
“Unfortunately many people did not see the wisdom of pursuing this concern, but instead criticized the president for allegedly protecting criminals (as branded by the media) such as Simataa and Kapofi.”
Simataa also dismissed allegations that he is a puppet of the president, saying that he respects Geingob as his president and his appointing authority, just like he respects other leaders.
The Bank of Namibia refused to comment on Geingob’s remarks that the bank had failed to detect the money that was being taken out of the country.
“This matter is subject to an ongoing judicial process which is yet to be concluded in the High Court, it will therefore prejudice the case to comment on this matter at this stage,” Bank of Namibia Spokesman Kazembire Zemburuka said.
“The Bank of Namibia has placed all material evidence pertaining to the SME Bank in relation to your question before court and as such is not in a position to discuss the details of this matter further.” 
Analysts who spoke to the Windhoek Observer said it is disingenuous for Simaata to wash his hands of the missing millions at SME Bank.
Citing Namibia’s corporate governance code (Namcode), one analyst said the code states that the board is responsible for corporate governance and has two main functions - determining the company’s strategic direction and controlling the company.
“The board requires management to execute strategic decisions effectively and according to laws and the legitimate interests and expectations of stakeholders.”
An official at a local auditing firm, who spoke on condition of anonymity because the firm has contracts with the Government, said board members have the ultimate responsibility in the running of a company as they are the ones who direct management.
The official explained that under both the Namcode and the King III of South Africa from which Namcode is derived, board members have a fiduciary responsibility to ensure good governance.


The Windhoek Observer is an English-language weekly newspaper, published in Namibia by Paragon Investment Holding. It is the country's oldest and largest circulating weekly.

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