Banking Crisis in Ghana
How some Ghanaian bankers, businessmen, and pastors play 419 on the Bank of Ghana, collapsing local banks.
How UT bank and Capital Bank got collapsed.
Tricks, failures, and greediness of some top officials like Dr. Mensa Otabil and Prince Kofi Amoabeng.
Also Ibrahim Mahama's inability to meet his obligations to the UT bank. As at May 2016, his total exposure was approximately GHS302m he had made no effort to honour any of the assurances he gave when they met on the 29th March 2016.
Amoabeng hid GHC 5m loan payment from UT Board
An investigative report into the operations of now-defunct UT and Capital Banks has revealed that some payments were made to former Chief Executive Officer and Director of U.T Bank, Mr. P.K Amoabeng from a loan defaulting entity, Kofi Jobs Limited.
The loans which amounted to GHC 5m were never disclosed to the Board of the U.T Bank. The report also revealed that there was a significant amount of inter-group lending involving other subsidiaries of the holding company, UT Holdings, while connected party loans were made to some companies as listed below:
Ibrahim Mahama’s Related Companies, amounting to GHC 261.4 m and US $ 6.4m
Quincy Sintim’s Related Companies, amounting to GHC 84.1m
Beige Group’s Related Companies, amounting to GHC 10.9m
“The bank sought a waiver of the Ibrahim Mahama related companies’ single obligor violations by the Bank, yet undertook a pass through US $6.4 million transactions by giving Beige Capital Savings and Loans a US $5 million placement as guarantee for Beige to extend a US$5 million loan to Hodman Brothers,” the report said.
“Placing foreign currency with a savings and loans company is a breach of the Banking Law. Likewise, the extension of a United States Dollar loan facility by a savings and loans company was in breach of the banking regulations,” the report added.
Capital Bank board squandered BoG cash
In the case of Capital Bank, it was alleged that the bank’s then-Board Chair, Dr. Mensa Otabil was party to the misuse of liquidity support given the bank by the Bank of Ghana (BoG), according to an investigative report sighted by Citi News. The report cites an emergency board and Executive Committee meeting on October 13, 2015, over the use of GHc 610 million liquidity support to the bank which was struggling at the time. The GCB in 2017, took over the two banks under a purchase agreement approved by the Bank of Ghana. GCB Bank has since absorbed about four hundred workers.
Source: https://citinewsroom.com/
Unlawful loans ‘sunk’ UT Bank
A swathe of non-performing loans, some granted contrary to banking regulations, on the books of UT Bank contributed to the bank’s collapse, an investigative report has noted. A number of these breaches were noted in dealings with companies linked to UT Bank.
The Banking Act requires that bank loans granted to its related entities, not connected to the UT Group, should be classified as single borrowers. This is for purposes of establishing a single obligor limit, i.e., the maximum amount a bank is allowed to lend, which stands at 10 percent of the bank’s net own funds for unsecured loans and 25 percent of the bank’s net own funds for secured loans.
But the report noted that several loan facilities exceeded the prescribed single obligor limit. “This behavior persisted over several years, and BSD examination reports have highlighted its prevalence in onsite inspection reviews,” the report stated.
“The pervasive incidence of SOL [single obligor limit] breaches underscore the rather poor credit management practices, poor credit governance, and supervision,” the report added. In some instances, UT Bank requested a waiver of the single obligor limit to “cover exposures emanating from the erosion of the bank’s equity.”
On May 12, 2016, the BSD sought approval to grant a waiver request for a single obligor waiver made for debts in relation to Ibrahim Mahama, the CEO of Engineers and Planners. There was definite concern over the loans granted Ibrahim Mahama per an emergency Board meeting held on May 20, 2016, cited in the report.
“The board expressed great concern about Mr. Ibrahim Mahama’s inability to meet his obligations to the bank. As at May 2016, his total exposure was approximately GHS302m and he had made no effort to honour any of the assurances he gave when he met them on 29th March, 2016.”
The report also noted that subsidiaries of Excel Courier, a company in which the MP for Efuttu, Alexander Afenyo Markin received an under-collateralized loan of close to GHS30.8 million from the bank. The value of the collateral was ¢990,000.
South African firm scared away
A South African private equity group, Leapfrog Investments, expressed interest in investing in UT Bank and undertook a due diligence probe of the bank in 2014. Leapfrog noted that the top 20 loans UT granted, with a balance of GHS457 million had a high legal risk of loss.
Documentation for only 18 of the 2o most substantial credited exposures was provided “Evidence of the approval of the credit committee of UT Bank Board has not yet been provided for 6 of the 18 facilities, nor have copies of the Board resolutions of the relevant borrows in respect of 4 of the 18 credit facilities.”
“No evidence of stamping had been seen on mortgages, and none of the mortgages had been registered with the company’s registry or collateral registry.” Also, “UT Bank’s loan and loss provisions, as assessed by Leapfrog may have been understated by as much as GHS136 million,” the report stated.
Source: https://citinewsroom.com/
Dr. Mensa Otabil and Prince Amoaben Must be arrested immediately.
DEMOCRAZY [Demonstration of Craziness.]
Ghana is sick we talk about Democracy which we don't practice. We practice DEMOCRAZY.
In a democratic world, everyone is the same and under one big umbrella which the LAW governs all people, no matter who the guy is or will be if he/she plays any trick on the system and found guilty he/she must pay or go to prison.
In Ghana, we talk about corruption which we don't fight but practice, simply because all corrupt men and women walk free and talk nonsense without any consequence.
Corruption has become a lifestyle. Now, whoever will manage to steal from the Government, better to say taxpayers monies can do and speak or behave anyhow, YES because that thief will be immune and untouchable by the LAW of Ghana.
This is not Democracy I call it DEMOCRAZY, the demonstration of Craziness.
It's about time Ghana must wake and fight corruption with an Excalibur.
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