We, at First Merchant Bank (FMB), recognise that the world has in effect become a global financial village –enhanced by more rapid communication and introduction of ever more sophisticated financial products.

In this context, FMB is continually striving to adopt to the needs of clients who themselves require highly competitive, efficient and flexible cross border banking services.

Financial products (of both an international and domestic nature) available from FMB include:

FOREIGN CURRENCY DENOMINATED ACCOUNTS (FCDAs)

These are Demand Deposit Accounts denomination in a foreign currency – named US Dollars, Pounds Sterling, South African Rand and Euros (Other currencies are available on request).

An attractive rate of interest (payable half yearly) is enjoyed on foreign currency balances.

Eligibility is restricted to bonafide exporters of goods/services as well as those individuals/bodies who are legitimately in receipt of foreign currency in form of salaries, grants, maintenance or external project funding.

A minimum credit balance of US$500 (or equivalent) should be maintained in the FCDA at all times.

TRAVELLERS CHEQUES (TCs)

These are available in a variety of currencies to bonafide travelers who are residents of Malawi.  TCs may be purchased for either holidays, business or medical travel.

Foreign currency travel allowances can also be pre-loaded on a Cash Passport debit card.

Whilst the bank has significant flexibility over the amount to be taken abroad at any one time, for obvious reasons strict adherence to Malawi Exchange Control Regulations is always ensured.

FOREIGN EXCHANGE PURCHASE

The Bank will purchase from bonafide clients cheques, dividend warrants, demand drafts and traveler’s cheques denominated in foreign currency.  Immediate credit will be given provided the bank is satisfied as to the integrity/credit worthiness of the drawer.

FORWARD SALE CONTRACTS

FMB will book Forward Sale Contracts for selected clients provided all necessary financial arrangements are in order.  A Forward Exchange Contract is an agreement between the Bank and Client whereby a specified sum of foreign currency will be made available by the Bank, (up to a maximum period of 6 months) at an Agreed Rate on an Agreed Date.

The benefit to the clients is that forward planning is made easier because the uncertainty caused by possible exchange fluctuation is eliminated.

Exchange Control approval is required for each specific Contract.

FOREIGN CURRENCY LOANS

The Bank can make foreign currency loans available to clients in receipt of foreign currency earnings such as growers and exporters of agriculture produce or clients who intend to purchase locally produced agricultural products (i.e. rice, cotton, pigeon peas, tobacco, etc.) for export purposes.

Such loans can significantly assist clients manage the seasonal cash flow cycle prevalent in the agricultural sector.  Clients in receipt of foreign currency earnings form exports of non-agricultural goods or services can also avail of foreign currency loans.

DOCUMENTARY LETTERS OF CREDIT (LC’s) – Imports

LC’s are recognised as being the most popular method of financing International Trade, and the Bank can make these available to Malawi importers.

An LC is a financial instrument established by the Bank on behalf of an importer (the applicant) in favour of an exporter (the beneficially) who is guaranteed payment by the Bank if goods supplied conform fully to the conditions of the LC.

An LC is always deemed irrevocable which means that once established, it cannot be withdrawn or changed in any way without the written consent of the beneficiary.

DOCUMENTARY LETTERS OF CREDIT (LC’c) – Exports

In the same way a bank may handle an incoming LC (established by a reputable overseas Bank) to secure foreign proceeds for a Malawian exporter.

FOREIGN REMITTANCES

Subject to Exchange Control approval of the Bank may effect remittances abroad in a variety of foreign currencies for the following:

• Payment for Imports
• Director’s fees
• Advertising charges
• Dividends
• Part Earnings (expatriates only)
• Medical Fees
• Education
• Subscriptions

OVERSEAS BANK ACCOUNT

Whenever necessary, should a client require assistance in the opening of an account with an overseas bank.  FMB will assist to the best of its ability, provided there is no implicit contravention of Exchange Control Regulations.

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