Commercial banks have backed changes to Malawi’s banking laws, saying stronger RBM powers could enhance financial stability and protect depositors while ensuring transparency and predictability.
Bankers Association of Malawi (BAM) president Phillip Madinga said the Banking (Amendment) Bill, 2026 gives regulators more options to intervene before problems at individual banks threaten the wider financial system.
“The proposed amendments represent a significant development in Malawi’s financial sector regulatory framework,” said Madinga, who is also chief executive officer of Malawi Stock Exchange-listed Standard Bank Malawi.
The Bill is among five financial sector reform Bills Parliament recently approved as part of a broader package of 14 measures aimed at overhauling financial regulation.
Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha, who presented the Bills, said the reforms are intended to modernise financial regulation, strengthen depositor protection and improve the framework for dealing with distressed financial institutions.
Madinga said instruments such as bridge banks, purchase and assumption transactions, asset management companies and administrative liquidation, align Malawi more closely with internationally accepted bank-resolution practices developed following the global financial crisis
He said the measures could preserve critical banking services while reducing the potential costs of bank failures to taxpayers and the financial system.
Parliament’s Budget and Finance Committee has also backed the reforms, arguing that the existing regulatory framework needs strengthening to deal more effectively with risks in the financial sector.
Presenting a joint committee report during deliberations on the related Financial Services (Amendment) Bill, committee chairperson Sosten Gwengwe said Parliament scrutinised the legislation “to determine whether the proposed amendment adequately strengthens the legal framework governing the administration of unclaimed funds while promoting legal certainty, transparency and accountability”.
The committee supported the proposed framework but called for safeguards, including operational guidelines, public awareness, protection of beneficiaries’ rights and continued monitoring of implementation.
Mwanamvekha similarly said the Financial Services amendment forms part of efforts “to harmonise the Financial Services Act with the Public Finance Management Act, 2022”.
For banks, however, the more consequential changes are contained in the Banking amendment, which significantly expands regulatory intervention powers.
Madinga said these could reduce the risk of disorderly bank failures and reassure depositors that mechanisms exist to maintain critical services when a bank encounters financial distress.
But he said the implications for investors require careful management because some interventions could affect shareholders and ownership rights.
The five approved Bills were part of a wider programme that amended 14 financial sector laws, potentially making the exercise one of Malawi’s most extensive financial regulatory overhauls in decades.
