British-American Investment Co., the Kenyan money manager known as Britam, sought to assure investors that it’s unaffected by regulatory action taken against two associated Mauritian companies.
Mauritius’s central bank on April 3 revoked Bramer Banking Corp.’s license and the Indian Ocean island nation’s Financial Services Commission appointed conservators for BAI Co., an insurer owned by the same company that controls Bramer. Dawood A. Rawat and Moussa I. Rawat, who are directors of the two Mauritian companies, have since resigned as directors of Britam Kenya, Britam Chairman Francis Muthaura said on Monday.
“Bramer Bank and BAI are not subsidiaries or holding companies” of Britam, Muthaura said in a statement e-mailed by the Nairobi Securities Exchange. “We wish to reassure our shareholders, policyholders, customers and the general public that Britam businesses continue to operate as usual.”
Bramer had its license suspended after Mauritian Prime Minister Anerood Jugnauth said there was “strong evidence” that the lender was engaged in a Ponzi scheme exceeding 25 billion rupees ($700 million). The bank came under scrutiny after the Bank of Mauritius carried out an investigation between Jan. 22 and Feb. 20 and found a “number of significant deficiencies.”
Britam’s shares traded unchanged at 22.50 shillings by 11:34 a.m in Nairobi. The stock has fallen 24 percent this year, underperforming a 5.3 percent increase in the Nairobi Securities Exchange All Share Index over the same period, according to data compiled by Bloomberg.
Britam Managing Director Benson Wairegi has been an independent director of Bramer since July 2013.
“The board of directors of Britam have full confidence in the leadership and integrity of our group managing director,” Muthaura said.
The State Insurance Co. of Mauritius has begun the process of taking over the 23.9 percent stake in BAI held by Dawood Rawat “to secure the interests of the local and international shareholders,” Britam Kenya said on Monday in a separate e-mailed statement.