The Arab Gambia Islamic Bank’s managing director Isatou Jawara and operations manager Ousainou Jallow earlier today faced the panel at the Local Government Commission of Inquiry to give evidence over the ‘Mballit’ Project trucks financing deal with the Kanifing Municipal Council.
The duo proffered evidence connected to the bank’s role in financing a controversial trucks procurement project.
At the heart of the inquiry was a joint venture between AGIB and Espace Motors, a local vehicle supplier, for the purchase of the trucks under the Mbalit Project.
The executives presented key financial documents, including the joint venture agreement, the financing application and transfer records for payments made to suppliers in China.
According to their testimonies, four separate transfers (on February 22, 2019 , February 25, 2019, February 27, 2019 and March 18, 2019) were processed to cover the truck purchases, totaling D122 million. The bank’s profit margin from the deal stood at D13 million, while Espace Motors’ was pegged at D8 million.
The Commission raised concerns over due processes by the bank.
MD Jawara acknowledged that no independent financial assessment of Espace Motors had been conducted before entering into the joint venture. Instead, she said, the financing was based on trust in the longstanding business relationship between the bank and Espace Motors.
“The project had no specific collateral,” Jawara told commissioners. However, she held that Espace Motors had sufficient collateral with the bank to cover any potential losses.
Operations manager Jallow expressed views in support of the MD’s assertion before the Commission. He said AGIB has a memorandum of deposit with Quantum (Espace Motors) covering all transactions.
However, he admitted that the bank’s management credit committee had not reviewed or approved the truck financing deal, but that the bank proceeded solely under the framework of its general partnership with Espace Motors.
The inquiry commission also delved into conflicting testimonies regarding an earlier request from the Kanifing Municipal Council (KMC) for a credit facility.
Former AGIB relationship manager Samba Faye previously testified before the Commission that KMC’s request had been denied. Questioned over the substance of Samba Faye’s testimony, Jallow said he could not recollect such a request ever being discussed at the management level.
The lead counsel Patrick Gomez intensified his questioning, asking the duo why there was no formal agreement specific to the Mbalit Project and why no risk assessment was conducted.
“Was it sufficient to rely on an MoU to finance the purchase of the trucks without collaterals, no approval by the credit facility committee, no assessment and other requirements?” Lead counsel asked.
Jallow insisted that due diligence was observed, arguing that the bank saw Quantum (Espace Motors) as a partner rather than a regular customer.
Jallow’s attestation did not convince the lead counsel, who said: ““From the onset, the primary source of repayment, funds from the wards, failed to generate the necessary revenue.”
Counsel Gomez pointed out that AGIB ultimately had to obtain authorization from Quantum to pursue KMC for payment, a move that indicated the project’s financial instability from the start.
Jallow accepted the expected funds had not materialised, saying: “If the funds were coming as expected, it would not have been necessary to follow the KMC.”
Gomez raised that AGIB had miscalculated the financial viability of the Mbalit Project, failing to establish a clear path for repayment, which was possible “because there was no due diligence done”.
