Bona Life closes shop
Mbongeni Mguni | Thursday July 5, 2018 19:51
Bona Life holds about P800 million in annuities from nearly 1,000 clients. The company’s 20 permanent employees in Gaborone and Francistown were sent home yesterday, while the regulator, the Non-Bank Financial Institutions Regulatory Authority (NBFIRA) was said to have been informed of the closure.
It is expected that the regulator will take control of the life insurance company, following the latest developments.
Bona Life CEO, Regina Sikalesele-Vaka confirmed the company’s closure, adding that the move was due to the lack of a board, a situation which has hounded the firm for months.
Bona Life is owned by Foudello, a company in which the Botswana Opportunities Partnership (BOP) holds 40%, CMB 25%, Sikalesele-Vaka 25% and staff 10%.
BOP is a fund that at one point housed more than P400 million in investments funded by BPOPF and managed by CMB, before the hostile fallout late last year in which the pension fund accused CMB of attempting to make off with the pensioner-funded BOP.
As the pension fund and its asset manager locked horns, Bona Life reported CMB to NBFIRA for allegedly mismanaging P133 million of its own funds handed over for investment. CMB retaliated by slapping Sikalesele-Vaka with a P650 million letter of demand citing alleged misgovernance. The asset management fund also attempted to fire the CEO..
With hostilities rising, Bona Life’s board, on which BPOPF and CMB representatives sat with Sikalesele-Vaka and others, crumbled as the shareholders battled in the courts.
The CEO told Mmegi that the decision to close followed the failure of a process to appoint a new board to usher Bona Life back to stability.
“We have been trying to find a breakthrough and as management when we looked at everything critically, we found that the biggest enemy of progress was the lack of a board.
“The regulator said there needs to be a board and as shareholders we need to nominate directors. We had a meeting with all the shareholders and the function was given to me to nominate them, which I did and forwarded names to the regulator, BPOPF and CMB.
“I believed this was a big breakthrough, but on June 27, CMB said they wanted their owner, Tim Marsland and someone else he had chosen, put on the board as well,” she said.
Marsland, a South African national who established CMB at least six years ago, is reportedly being probed by the Financial Intelligence Agency and the Directorate on Corruption and Economic Crime in connection with the P400 million saga, which would impede his vetting by NBFIRA for a place on the Bona Life board.
Efforts to contact Marsland for comment were unsuccessful by late this evening.
“June 29, which was our date for the signing of the resolution on this matter, came and went without signatures, without a board constituted and there was no choice but to close the office.
“The closure is designed to protect our clients from exposure to a situation where a company is operating without board control.
“We have received money from Batswana. Batswana have been very supportive of this company, creating it from nothing. We have a responsibility to look after and protect them.
“Our policyholders have to understand that this action has been taken to protect them and for as a long as it operates without a board, they are exposed. Even the attempt to fire me without a board in place, exposed them to certain risks.”
Sikalesele-Vaka said there were no guarantees available to Bona Life’s clients.
“If you are trading or operating in an environment that is very uncertain, you cannot given anyone a guarantee. I cannot say people should not worry; maybe they should be very worried.
“What I can say is that we are trying very hard to make sure that they are protected but we cannot give guarantees.
“What we can say is that as far as we are concerned, we have kept NBFIRA informed and part of the regulator’s mandate is to make sure the public is not prejudiced.”
NBFIRA officials could not be reached for comment this evening. The regulator is due back at the Court of Appeal on Thursday for the matter in which they are attempting to place CMB under statutory management in relation to the P400 million case.