FINANCE MINISTER SCHEMING ‘CRONY’ PAYOUT TO OTABIL AND CO

– Revealed!

…Using GCB Cash

Emerging files on the surprise takeover of UT Bank and Capital Bank are assembling into a picture of Finance Minister, Ken Ofori-Atta, as a master tactician, who is trying to make a Houdini out of cronies, caught flatfooted in the scandalous collapse of UT and Capital.

Apparently, the Finance Minister is organizing payouts to shareholders of UT and Capital banks, who should lose their investments due to the collapse of the two banks. He looks to be doing so with savings of GCB customers.

One man who has carefully read the chess game is the Member of Parliament for Bolga Central, Hon. Isaac Adongo.

“Hon. Ken Ofori-Atta and Bank of Ghana now, with a Board that is tainted with Enterprise Group would collapse the financial market of this country and there will be no iota of confidence in our financial market,” Hon. Adongo told Radio Gold yesterday.

His statement was in reference to how the BoG has vandalized many rules of the financial market, and laws of Ghana, to hastily acquire UT and Capital banks, in a manner that inures to the benefit of investor friends who should have lost their investments.

In a chess game that Ofori-Atta is playing, there are also suspicious redeployments.

Beginning from the Ministry of Finance, Ken Ofori-Atta, since becoming Finance Minister, is said to have removed as many as eight civil servants and replaced them with people from his personal bank, Databank.

He is said to have also deployed a number of Databank staff at the BoG, whose Governor, Dr. Ernest Addison, was only force-fitted into place after his predecessor, Dr. Abdul Nashiru Issahaku, had been forced by President Akufo-Addo to resign.

With Dr. Addison, brother of President Akufo-Addo’s good friend and lawyer, Philip Addison, perpetually under siege from a Board of Directors tainted with Databank operatives, the BoG is effectively under Ken Ofori-Atta’s stranglehold.

It is this BoG tainted with Databank that announced the surprise takeover of UT Bank and Capital Bank by the GCB on Monday, this week.

In undertaking the takeover, Hon. Isaac Adongo points out that a lot of rules had been broken, including the fact that shareholders of the Ghana Commercial Bank had not been informed.

“At what time did the shareholders of Ghana Commercial Bank take the decision and gave the approval for two toxic assets to be acquired by that bank, at what point; do we have any shareholders meeting, do we have any extraordinary shareholders meeting?” Hon. Adongo asked rhetorically.

As the shareholding structure of GCB includes a GoG and Social Security and National Insurance Trust (SSNIT) share of 51%, Hon. Adongo points out that the shareholders of the GCB that were ignored by the BoG in the directive to have UT and Capital taken over by the GCB are ordinary pensioners.

“The fund that you and I when we retire will get a stipend from is being risked on investment by Ghana Commercial Bank without recourse to shareholders of Ghana Commercial Bank,” Hon. Adongo points out.

And the whole transaction gets murkier, given the fact that the BoG, as regulator, and not the owner of the GCB, had no locus, whatsoever, to direct the GCB on what assets to acquire and what assets not to acquire.

The BoG’s driving of the GCB to acquire the two banks without recourse to the shareholders therefore is a vandalism of shareholder rights, Hon. Adongo said.

As the BoG is seen as an extension of Ken Ofori Atta’s Databank, it is seen that the forceful acquisition of UT and Capital was the doing of the Finance Minister.

Dr. Ernest Addison has claimed that the acquisition of the two banks by GCB had been done after a bid-out by a number of other institutions, alongside the GCB, and that the GCB had beaten all of them, but nobody knows what these other bidders are.

Meanwhile, the two private banks had collapsed due to insolvency that was apparently brought on by mismanagement.

Mr. Kwesi Pratt, Jr, the managing editor of ‘The Insight’ newspaper, has revealed that Capital, for instance, had collapsed due to incessant borrowings by shareholders and management members, who did not repay the bank.

Mismanagement being the cause of the collapse, Hon Isaac Adongo said it would have made sense to allow those who mismanaged the two private banks to go down together with the bank that they had mismanaged.

The Bolga Central MP sneered at what he portrayed as profligate spending by the managers of the collapsed banks, saying some of them drove very expensive cars.

He said the GCB’s move to acquire those banks means it is buying a toxic property with the good money that belongs to investors, including pensioners, to the advantage of reckless managers and shareholders of private banks who would never have shared their profits with the ordinary pensioner, whose money Ken Ofori-Atta is applying to buy out the collapsed banks.

The shareholders of Capital Bank include Dr. Kofi Mensah, who was the managing director of the bank, in addition to being a shareholder.

President Akufo-Addo has since appointed him as the MD of the Agricultural Development Bank.

Another shareholder of Capital Bank is Dr. Mensah Otabil, whose company, Otabil and Associates, and church, International Central Gospel Church, are listed in the shareholding structure of the bank

Hon. Isaac Adongo yesterday lamented that even though the GCB’s acquisition of the collapsing banks makes it possible for their shareholders to get bailout, the nature of the liabilities that the GCB has taken upon itself are still shrouded in secrecy.

“What is the financial obligation that Ghana Commercial Bank has taken on in this transaction, again we do not know that. So we are told that Ghana Commercial Bank has taken on the assets and liabilities of these two collapsed banks, but what is the nature of this liability, is it the kind of deposit that these reckless banks took on the back of extraordinary interest payment on deposit?

“You recall that these were banks that were going around collecting deposits, as a savings and loans company, at rates that were even above the base rates of banking systems in this country. And they were taking those loans because they could go out there and milk the general public by charging interest of 5% a month. Basically charging between 50 and 70% interest at the end of the financial year. Is it this kind of liability that Ghana Commercial Bank has taken on? Or it is the kind of assets that the traditional conservative Ghana Commercial Bank would normally not get involved?

“Look at the branch network of UT Bank and Capital Bank, the kind of investments in those banks; have you ever seen a Ghana Commercial Bank branch that looks like any of those branches? Why will Ghana Commercial Bank now be going away from its strategic field, to take up assets of branches that they would never invest that kind of money in?

“I am told that one branch of Capital Bank at Labone cost 3 million dollars. Will Ghana Commercial Bank buy a property of 3 million dollars for purposes of making it a branch network? And so, we do not even know the true extent of the values that have been taken on,” Hon Adongo pointed out.

He said, the two collapsed banks that have been acquired by the GCB under the directive of a Databank-tainted BoG are banks that are affiliated to the NPP and that the ruling party only used the GCB to acquire them to help save the skin of cronies of the government.

“I have a very serious suspicion that Ghana Commercial Bank is being used as a means to dole out money to cronies and shareholders of these two collapsed banks that are related to NPP through our own money at Ghana Commercial Bank.”

The Bolga Central MP pointed out that in the BoG’s hurry to make the GCB acquire the two collapsed banks, the Central Bank pushed the GCB to vandalize the Securities and Exchanges Commission (SEC)’s regulations.

“Ghana Commercial Bank is a listed company on the Ghana Stock Exchange and, as a listed company, it will have to be approved by the Securities and Exchanges Commission to engage in this kind of transaction. The Securities and Exchanges Commission, as we all know, it doesn’t even have a Board. So how did Ghana Commercial Bank get the approval from the Securities and Exchanges Commission to engage in a transaction that has the potential of derailing the progress of Ghana Commercial Bank?” He asked.

Incidentally, Finance Minister Ken Ofori-Atta, who is suspected to be behind the GCB takeover, similarly ignored the SEC in the issuance of the $2.25billion bond that was bought by Franklin Templeton, a company in which his business partner works.

Hon. Adongo said Ken Ofori-Atta’s dodge of the SEC was deliberate and that the act of ignoring the SEC fell in step with a shroud of secrecy that the government has kept around the whole transaction.

“If  Bank of Ghana is minded, this is not a trading of any illicit activities you have  been able to move deposits to Ghana Commercial Bank and moved certain assets to Ghana Commercial Bank what is the value involved, how much are we talking about. Are we hiding behind Ghana Commercial Bank to over value certain assets such that monies will come out of those investments to pay off the shareholders?”

 

 

Source: therepublicnewsonline.com/Stan Adotey

The Republic News Online

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