Zambian tycoon Rajan Mahtani's bank wins $173 million from Malawi over 2005 shutdown

Finance Bank of Malawi, the defunct lender owned by Zambian tycoon Rajan Mahtani's group, has been awarded K300 billion ($173 million) in damages for the central bank's unlawful decision to shut it down in 2005. Malawi's government says it will challenge the payout as excessive.

Attorney General Frank Mbeta said he would ask a full bench of the Supreme Court of Appeal to review the award. "I believe the award of K300 billion is excessive," Mbeta said in an interview published on Nov. 11. "I will be filing for review of the award before the full bench of the Supreme Court of Appeal within this week."

The award was set on Nov. 4 by Ibrahim Hussein, an assistant registrar of the Supreme Court, who assessed what the Reserve Bank of Malawi owes the bank for revoking its licence in 2005. Finance Bank had claimed about K1.1 trillion ($634 million).

How the award breaks down

The assessment gave the bank K157.5 billion ($90.8 million) for lost business and profits, K138.1 billion ($79.6 million) for malfeasance in public office and K150 million ($86,500) for breach of its constitutional rights. Those amounts add up to about K295.7 billion, slightly below the K300 billion total reported for the award.

The state had argued that the bank was entitled only to nominal damages. It pointed to the Supreme Court's instruction that damages, "if any," should be assessed. Mordecai Msisha, the senior counsel representing Finance Bank, argued that the wording did not cast doubt on the central bank's wrongdoing.

The financial calculations behind the bank's claim were prepared by Mkuzo Kenneth Kuwana of Kita and Co., who is also group financial adviser to the Mahtani Group, which owns Finance Bank.

A two-decade fight

The Reserve Bank of Malawi revoked Finance Bank's licence in May 2005. The bank challenged the decision and reopened on June 6, 2005, but some officers could not return because of a restriction order from the Anti-Corruption Bureau. The bank went into voluntary liquidation in January 2006.

In October 2014, the High Court's commercial division awarded the central bank K13 million and dismissed the bank's counterclaim. The case turned on Feb. 3, 2026, when the Supreme Court of Appeal ruled that the licence revocation was unconstitutional and ordered damages to be assessed.

The government says the award would place a heavy burden on public finances. Supporters of the bank say it reflects the cost of unlawful regulatory action.

Mahtani is also the founder of Finance Bank Zambia, which Zambia's central bank took over in 2010 before returning it to him. The Zambian bank was later sold to Atlas Mara.

Figures were converted at K1,735 to the dollar.