Concerns Mount Over Zambia Banking Regulator’s Handling of BONI Investment

Zambia’s regulatory framework for banking investments is under scrutiny following a dispute between the Bank of Zambia (BoZ) and BONI Global, a Nigerian-linked investment firm, over the recognition of a major shareholding in Investrust Bank Plc.

The case has drawn attention from regional and international investors at a time when Zambia is actively promoting itself as a destination for intra-African capital.

BONI Global, led by investor Michael J. Prest, acquired a 24.8% stake in Investrust Bank in 2021 through licensed broker Pangea Securities on the Lusaka Securities Exchange (LuSE). The firm said the transaction was completed in line with LuSE trading and settlement rules.

However, because Investrust Bank is a regulated financial institution, BONI was later informed that approval from the Bank of Zambia was required for its shareholding to be formally recognised. BONI said it subsequently sought regulatory clearance and made repeated inquiries to the central bank.

In January 2024, the Bank of Zambia informed BONI that it did not recognise the firm as a shareholder in Investrust Bank. Three months later, in April 2024, the regulator placed the bank into liquidation.

BONI argued that it was not treated as a recognised shareholder during the period preceding the liquidation, including in matters related to governance and board representation. The firm said the liquidation effectively wiped out the economic value of its investment.

The Bank of Zambia has not publicly disclosed its reasons for declining shareholder recognition, citing confidentiality rules that apply to regulated financial institutions.

The dispute has raised broader questions about how ownership rights are treated for listed banks in Zambia, particularly where regulatory approval is required after a share purchase has been settled. Market observers note that in many international markets, economic ownership typically vests upon settlement, even where regulatory approvals remain outstanding.

Legal analysts said approval regimes for significant shareholdings in banks are common globally, but stress that clear rules on investor protections, remedies, and capital recovery are essential to maintaining confidence in capital markets.

BONI has indicated it is seeking the return of its invested capital and has put forward a compensation claim of about US$40 million. Neither the Bank of Zambia nor the Lusaka Securities Exchange has commented publicly on the claim.

The case has attracted attention within African investment circles as Zambia continues to court regional investors. President Hakainde Hichilema has consistently highlighted transparency, predictability, and institutional reform as key pillars of the country’s investment agenda.

Analysts said the outcome of the BONI–Investrust dispute could influence investor perceptions of regulatory certainty in Zambia’s financial sector, particularly for cross-border African investments. For now, the matter remains unresolved.