KEN LEADS COUP AT ADB

…Backed by puppet army from Databank

The sudden, unexplained decision by Belstar Capital Limited, largest shareholder of the Agricultural Development Bank, to walk away from the bank, is fallout from murky undercurrents that Ghana’s Finance Minister has been stirring up.

As Belstar embarks on moves to sell its shares in the bank, matters are on a coup footing at the ADB with a bull in a china shop called Ken Ofori-Atta stampeding about to effect a planned merger with the NIB.

The Republic has heard of how some three companies (name withheld), associated with Mr. Ofori-Atta, have been strategically positioned to buy into the merger between ADB and the National Investment Bank (NIB) when it commences.

And because the future prospects of having a stake in a National Development Bank, which will result from a merger of ADB and NIB, are juicy, the Finance Minister is weeding every impediment from the path of history and damning the consequences.

Belstar Capital’s decision to turn tail leaves the Board of the NIB as the next main opposition to Mr. Ofori-Atta’s moves to effect the merger between ADB and NIB, sources say. The Republic has heard of how Togbe Afede ll, Board Chairman of the NIB, is vehemently opposed to the move.

Sources tell The Republic that Mr. Ofori-Atta’s incorrigibility in the matter of the merger has even strained his friendship with the NIB Board Chair, who is a founding member of Mr. Ofori Atta’s Databank.

Currently, the shareholding structure at ADB is made up of Belstar Capital – 34.3 percent, Government – 32.3 percent, Starmount Development Company – 11 percent, Bank of Ghana – 9.5 percent and EDC now (Ecobank Capital) -6 percent.

By its superior share endowment, Belstar’s position against the merger with the NIB makes it impossible for the Finance Minister to effect the merger. The Finance Minister’s answer to the problem is to put together the shares of GoG and the BoG in the name of both being government interests.

With the new majority stake of 41.8%, government now assumes the majority shareholding position, which gives the Finance Minister the upper hand to push through the agenda to effect the merger.

From the NIB end, it is a virtual cakewalk for Ken Ofori-Atta because the NIB is state-owned. Even so, the Board of the NIB, just like Belstar Capital, is said to have pooh-poohed the explanation that the merger is imperative for both ADB and NIB to survive a new capital requirement regime that the BoG has put in place.

The Bank of Ghana announced in September, this year, that the minimum capital requirement for banks had been increased from Ghc120million to Ghc400million, a thing that has left a wave of fold-ups looming, because most local banks do not have the financial muscle to provide such capital.

Unlike most of these local banks, however, the Board of the NIB, which boasts assets estimated to be US$468.5million, is said to be of the position that the bank can ride the new minimum capital requirement regime and therefore does not need to be merged to survive.

In the case of the ADB, the survival argument actually sounds silly because the very government which is attempting to merge it with the NIB with the excuse that it needs it to survive the new capital requirement of Ghc400million, only a few months ago, borrowed Ghc450million from the ADB for its ‘Planting for Food and Jobs’ program.

Member of Parliament for Bolga Central, Isaac Adongo, recently told The Republic that the NPP government has no justification whatsoever in the decision to collapse ADB into NIB, because, if the Ghc400million minimum capital requirement will be a problem for ADB, then all the government has to do is to return the bank’s Ghc450million loan.

In spite of the glaring holes in the government’s argument, however, the Finance Minister is incorrigibly pushing through moves to merge ADB and NIB into NDB.

According to Republic sources, part of the motivation is that the merger process will create a window of opportunity for some three companies associated with Mr. Ofori-Atta to buy shares in the new NDB.

Belstar Capital, which has indicated intent to sell its shares and invest proceeds into uniBank has been constrained to walk out because Ken Ofori-Atta’s alleged bullish pursuit of the merger will bring in new shareholders that will cause Belstar to plummet from its majority shareholding position.

And in the issue, the playing field is not level because a shrewd Mr. Ofori-Atta, who is one of the many family members of President Akufo-Addo appointed into government by Big Brother, has had practically all basis covered.

For instance, the Finance Minister’s decision to leverage BoG’s shares in ADB could have been resisted by the BoG, but such resistance will just not happen because Mr. Ofori-Atta has a stranglehold on the Board of the BoG. Transplants of business partners from Databank onto the Board of the BoG include Keli Gadzekpo, the Finance Minister’s business partner and co-owner of Databank.

Under normal circumstances, a pigheaded decision by the Finance Minister to get two public banks collapsed into each other would have been seriously scrutinized by technocrats at the Finance Ministry. However, since coming into office, a shrewd Ken Ofori-Atta has replaced as many as eight senior technocrats at the ministry with people from his Databank.

Ultimately, the merger would have to be approved by the Securities and Exchange Commission before it can go through; but here too, a shrewd Ken Ofori-Atta has his man as head honcho. Rev. Daniel Ogbamey Tetteh, the Director General of the SEC, was until his appointment in May, this year, as the Director General of the SEC, Vice President of Databank.

With all the permutations on the ground showing Ken Ofori-Atta as clever tactician, Belstar Capital has been constrained to walk out of ADB to forestall the situation where the upcoming merger will bring in hawks that will bring it down from its majority shareholding position at ADB.

Media reports confirm that Belstar has decided to move on from the ADB but the reasons behind the divorce are firmly held to its choice.

The Republic has heard that the reasons for the divorce are the bully tactics of Ken Ofori-Atta who allegedly wants to bring in three companies affiliated to himself to take a good hold of the intended NDB.

Meanwhile, at the NIB, Togbe Afede and his Board members are also said to be fuming over Mr. Ofori-Atta’s perceived power lust and greed in the financial sector. In addition to having people from his Databank deployed to all strategic sectors of the financial sector, the man is also seen to be using his companies to milk Ghana of money.

It would be recalled that Mr. Ofori-Atta’s first ever bond issuance as Finance Minister was the scandalous $2.25billion which has since led to conflict of interest and insider dealing probes. Franklin Templeton, the US company which bought 95% of that bond was later found to be associated with Hon. Trevor G. Trefgarne, Board Chairman of Ken Ofori-Atta’s, Enterprise Group.

This same Enterprise Group was recently involved in the scandalous arrangement to institute a compulsory insurance policy for personnel of the National Service Scheme.

Without recourse to the personnel and Parliament, the government had announced a compulsory monthly deduction of Ghc15 from the allowances of all NSS personnel for an insurance scheme that would be partly run by Enterprise Life.

The personnel resisted the move leading to the government eventually backing down on the move.

Sources say that Togbe Afede, a bosom friend of Mr. Ofori Atta’s, is disgusted by the fact that the Finance Minister’s greed has been escalated to the NIB where as Board Chairman, he has serious plans of leaving a great legacy.

The incorrigibility of Mr. Ofori-Atta’s plans to pluck NIB out of Togbe Afede’s hands is said to have strained relations between them.

 

 

 

Source: therepublicnewsonline.com/Fiifi Samuels

The Republic News Online

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