The New Patriotic Party (NPP) government is going through the motions to make the Ghana Commercial Bank take over the National Investment Bank (NIB).
After Finance Minister, Ken Ofori-Atta, had announced government’s intent to divest State Owned Enterprises in the 2017 Budget and Fiscal Plan, national broadsheet, Daily Graphic, has since reported of consultations between the Boards of both GCB and the NIB on the upcoming takeover.
The crystal ball shows that the takeover will be swift as the Board Chairman of the Social Security and National Insurance Trust (SSNIT), Dr. Kwame Addo Kufuor, and newly appointed Managing Director of SSNIT, Dr. John Ofori Tenkorang, are said to be singing from the same hymn sheet.
SSNIT owns a majority share of 29.89% in GCB, with government owning the second largest of 21.35%. As the Finance Ministry, headed by Ken Ofori-Atta, is the manager of government’s share in GCB, his hint of the sale of the NIB in the 2017 Budget was a true herald.
But as the official narrative about the impending takeover of NIB by GCB presents sugarcoated explanations that the assimilation will lead to a better asset endowment of over GHc10billion for the GCB and therefore help it employ more people, the recent stories about the NIB have dangled question marks on the real intention of the NPP government.
It would be recalled that the Supreme Court, last month, ruled that the NIB is not liable to repay over $60million to an investment company, Dominion Corporate Trustees Limited.
The ruling meant that former Manager of the NIB, Mr. Charles Gyimah, who had been appointed to that post by former President Kufuor, is now saddled with the debt, which has since ballooned into some $106million.
In the wake of the judgment, Mr. Gyimah, whose dabble in a white collar scheme, while MD at the bank had brought about the debt, was alleged to have had the support of NPP gurus who had been rooting for Dominion winning the case against the NIB.
According to the allegation, the NIB’s loss of the case would have given the Akufo-Addo government the perfect cover story to sell off the bank, even as a number of NPP gurus had already lined up in preparation to scramble for the assets of the bank.
Sources name Mr. Charles Gyimah himself, Senior Minister Yaw Osafo-Maafo, former Chief of Staff to the erstwhile Kufuor administration, Kwadwo Mpiani, Lawyer Sam Okudzeto, and Nene Amegatcher as the gurus, who had been lying in wait to pounce.
According to information, some of them who had mostly stayed abroad during the NDC’s eight-year administration had chartered a plane, stuffed with champagne, back to Ghana on the day the Supreme Court was scheduled to give judgment, ready to pop in celebration as they anticipated a victory.
As things later turned out, however, the efforts of counsel for the NIB, Tsatsu Tsikata, had been good enough to convince the court that the NIB did not owe the Dominion Group a pesewa. In fact, the court even awarded a GHc50,000 cost against Dominion.
It is barely a month into the Supreme Court scuttling the alleged agenda of the NPP gurus to grab assets of the NIB for cheap that the NPP government has started the motions for the GCB to take over the NIB.
Insiders reveal that deep-pocketed NPP government officials have started lobbying NIB union, promising members of juicy personal benefits just so the planned takeover by GCB will not be resisted.
In the wake of the revelations that the Boards of both GCB and NIB are already consulting on the takeover, the official narrative has been that the takeover is probably a merger that will enhance the asset base of the GCB in excess of GHc10billion.
But the question that has since begged answering is why the government is trying to divest the NIB, after the official state lender has won the court case that places it on a very healthy footing.
Worried sources say the takeover is just a camouflage, as the GCB, which is not wholly owned by government, will bring the publicly wholly owned NIB’s assets to nourish the asset base of the GCB to the benefit of other private investors. Shareholders of the GCB include Ghana Reinsurance, SSNIT and COCOBOD.
Some of these investors are said to be strongly linked to the NPP.
Hopeson Adoryeh, a member of the NPP’s own Communication Team, has long revealed that in addition to Charles Gyimah and Kwame Pianim, there are three more NPP gurus who were behind the failed suit against the NIB.
On Accra based Asempa FM, he had said that he had gathered concrete evidence on the shadowy NPP gurus behind the suit and that he was going to give the evidence to President Akufo-Addo.
That failed suit would have saddled the NIB with over $120million debt, but the apex court quashed a 2013 judgment of an Accra High Court that had ordered the NIB to pay a $60million and interest to Dominion Corporate Trustees, over a guarantee of $45million promissory notes in 2007.
Against the High Court (Commercial Division)’s judgment that NIB should pay the $45million value of the promissory notes, plus $15million contractual accrual on the principal in addition to other interests, the SC had rather dismissed the claim against NIB and ordered that the bank be paid GHc500,000 in damages.
The judgment left Mr. Charles Gyimah, who is said to have used his position as MD of NIB to guarantee the promissory notes and later shared the proceeds among cronies, including his son, hot. Since the mastermind of that ploy in 2007, the debt has fed on itself and grown into a humongous $106million.
In May 2007, Eland Ghana Limited issued promissory notes worth $45 million which was bought by various investors, including Standard Bank Offshore Trust Company. The promissory notes had been guaranteed by the NIB, which was then headed by Daniel Charles Gyimah.
Under the agreement, the investors were to earn GHc15million as profit in addition to the $45million principal, so that in all the investors would be paid back $60million upon the maturity of the notes which was to be in January 2009.
However, upon the maturity, the NIB refused to be saddled by the $60million debt leading to Standard Bank Offshore Trust suing the Ghanaian bank at the Accra High Court, Commercial Division.
Later, Standard Bank Offshore Trust had been substituted by Dominion Corporate Trustees Limited. In a counterclaim, however, NIB had joined Mr. Daniel Charles Gyimah and Eland.
In the course of the trial, the NIB had led evidence to show that its Managing Director at the time, Mr. Daniel Charles Gyimah, had signed the guarantee without any authorization from the board of the bank.
The bank also led evidence to show that the US$45 million was not used for the purpose that it had been advertised for and that Mr. Gyimah had rather shared the money among Eland and firms connected to the company which had issued the promissory notes.
Other beneficiaries that had been allotted some of the cash included a London based company called Iroko Securities Limited and other private individuals including the son of Mr. Gyimah, one Stephen Gyimah.
According to the revelations in court, the largest beneficiary was Sphynx Limited, a company based in the US, which had been allotted US$24 million.
Interestingly, it later emerged that Sphynx Limited was a fully owned subsidiary of Iroko Securities Limited.
In a February 21, 2013 judgment, the High Court had declared NIB liable. Justice Amadu Tanko had ordered the bank to pay the $60 million, with 11 percent interest to Dominion Corporate Trustees Limited. The debt has since fed on itself and distended into some $120million.
Per the court’s judgment, payment was to take effect from January 2009 until the day of final payment.
However, NIB, led by respected defence lawyer, Tsatsu Tsikata, appealed the judgment at the Supreme Court, leading to the SC quashing the earlier judgment of the High Court and an order to Dominion Corporate Trustees Limited to pay GHc50,000 in damages to NIB.
The judgment left Mr. Daniel Charles Gyimah, against whom a bench warrant had at a point in 2013 been issued, saddled with the $120million hot mess.
As NIB was absolved of the Ghc45million debt, accruals of $15million and interest that has grown since 2009, Mr. Gyimah naturally comes under liability to pay the gargantuan dollar debt owed the investors who sank money into the promissory notes.
Dominion had been represented in court by Mr. Kwame Pianim, an investment consultant.
Source: therepublicnewsonline.com/ Fiifi Samuels