Ghana Business News, Financial & Economic news

The Deputy Minister of Energy in charge of Petroleum, Dr Mohammed Amin Adams has reiterated Ghana’s commitment to good governance and transparency, saying the country will ensure equitable growth to avoid the proverbial resource curse and mistrust among the citizenry.

The GCB Bank Limited has successfully secured its banking platform against third-party access after some customers reported suspicious transactions in their accounts at the weekend.

President Nana Addo Dankwa Akufo-Addo, left Ghana yesterday (Tuesday) for South Africa to participate in the Africa Investment Forum, which is being held in Johannesburg.

President Nana Addo Dankwa Akufo-Addo yesterday rang the bell to launch the Ghana Commodity Exchange (GCE), a platform for buying and selling agricultural commodities in the country.

For decades, entrepreneurs in Ghana have relied on family support to grow their businesses.

Japanese multinational automobile manufacturer, Nissan have signed a memorandum of understanding (MOU) with Ghana to establish an assembly plant in the country.

Nyonkopa Cocoa Buying Limited has been awarded the 2017 Best Agribusiness Company at the maiden edition of the Ghana Business Awards held at Kempinski Hotel Gold Coast City in Accra last Friday.

The government has approved an amendment of the Plan of Development (PoD) for the integrated Offshore Cape Three Points (OCTP) Oil and Gas Project. 

Many people do not want to hear about funeral insurance policies because not everybody wants to be reminded about the inevitable.

Former workers of the defunct Capital and UT banks have called on the government to attend to the psychological needs of their members suffering from the trauma following the unexpected liquidation of their banks.

The Chartered Institute of Marketing-Ghana’s (CIMG’s) annual Strategic Marketing Conference has ended in Accra with a focus on the role of marketing in supporting the government’s “Ghana Beyond Aid” agenda.

The economy of Ghana has experienced remarkable progress over the last quarter of the century, but there is increasing incidence of poverty and inequality levels, an economist, Dr Kojo Appiah-Kubi, observed on Thursday.

Ghana has moved  two places up on the ‘Trading Across Borders’ in the latest World Bank Ease of Doing Business Report, an indication that the paperless port clearance system initiated by the government is already paying off.

In spite of a 4.5 per cent moderation in expenditures in the first seven months of the year, the fiscal deficit widened to 3.8 per cent of gross domestic product (GDP), due to a drop in total revenue and grants within the period.

It’s no secret that housing is a major challenge, and its mostly because homes and lands are absolutely expensive.

The Republic Bank Ghana, a subsidiary of Republic Financial Holdings Limited, will in collaboration with the Ghana Real Estate Developers Association (GREDA), organise a three-day Mortgage Expo. 

The Peasant Farmers Association Ghana (PFAG) is calling for increased public investment in the seed sector for Ghanaian seed growers to increase their seed production.

The Private Enterprise Federation (PEF), has described as unfair the country’s tax regime, which slaps equal rates and bands on both big businesses and micro, small and medium enterprises (MSMEs).

After missing two deadlines, trading on the Ghana Commodity Exchange Market (GCX), which seeks to provide a ready market for commodities, will finally commence today.

It's no news that many graduates today are delving into many crafts and setting them up as side businesses.

The General Overseer of the International Central Gospel Church (ICGC), Pastor Mensa Otabil, the ICGC and 13 shareholders and directors of the defunct Capital Bank Ghana Limited have been sued for allegedly engaging in acts that led to the collapse of the bank.

Pastor Otabil was the Board Chairman of the defunct bank, while the ICGC was named as a shareholder of the bank in the suit.

The suit was filed at the Commercial Division of the Accra High Court by the receivers of the defunct bank, Mr Vish Ashiagbor and Mr Eric Nipah, both of PricewaterhouseCoopers (PwC).

The plaintiffs are seeking to use the legal action to recover over GH¢837 million, being what they said were loans that the shareholders granted to themselves which remained unpaid.

By their alleged actions, the plaintiffs said, the defendants “have breached their fiduciary duties under the Companies Code, 1963 (Act 179) and have caused serious financial loss to the bank’’.

Defendants

The shareholders and the directors joined to the suit as defendants in the Capital Bank suit include the Founder of the Capital Bank, Mr William Ato Essien; Mr Oheneba Osei-Akoto, Mr Stephen Enchill, Mr Kingsley Atta Ghansah, Otabil & Associates, Mr Kwadwo Ayisi-Ahwireng, Mr Isaac Osah Thompson-Mensah and Mr John Kofi Mensah.

The rest are Mr Edwin Obeng Donkor, the former Chief Executive of the bank; Mr Fitzgerald Odonkor, Mr Amadu Montia, Mr Kofi Kwakwa and Mr Francis Adu Mante.

Revocation of licence

On August 14, 201, the licences of the Capital Bank and the UT Bank were revoked by the Bank of Ghana (BoG) after the BoG had declared them insolvent.

The BoG allowed the state-owned bank, the GCB Bank, to acquire the two banks in order to protect depositors’ fund and also enable them to stay afloat.

The hurricane that swept through the banking industry due to the collapse of the two banks further heightened in August 2018 when the central bank collapsed five other indigenous banks and merged them into one entity known as the Consolidated Bank.

Shareholders’ loans

In their statement of claim, the plaintiffs said the defendants “wilfully breached banking laws”, as a result of which, as of December 31, 2015, the bank had about GH¢482 million as “non-existent’’ investments on its books and loans granted to the defendants.

The statement of claim averred that by a resolution on May 3, 2016, the shareholders agreed to repay the said loan “in proportion of their shareholding’’.

It said as of August 14, 2017 when the licence of the bank was revoked, the shareholders were in debt to the tune of GH¢748,251,000.

The outstanding amounts to be paid by the defendants, as stated by the statement of claim, were: Essien, GH¢468,405,126; Osei-Akoto, GH¢36,664,299; Enchill, GH¢73,627,898; Atta Ghansah, GH¢36,664,299; Otabil & Associates /ICGC, GH¢51,629,319; Ayisi-Ahwireng, GH¢4,113,330; Kofi Mensah, GH¢15,713,271; Obeng Donkor, GH¢14,965,020, and Osah-Thompson-Mensah, GH¢24,692,283.

Apart from these outstanding amounts, the statement of claim said Mr Essien took a loan of about GH¢108 million for himself and the companies that he owned or in which he had vested interest.

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Alleged fraud

The plaintiffs further alleged a series of fraudulent actions, including the use of “a non-existent GH¢52.3 million investment certificate” by the defendants to top up the capital of the bank in order to obtain a universal banking licence.

“These funds were eventually included in the balance of bad placement that was converted into shareholders’ loans which were never paid,’’ they said.

Another allegation of fraud, the plaintiffs said, was the approval of the bank’s money for Mr Essien to be used as payment for mature investments for fixed deposits in Capital & More Limited, a company owned by Essien.

“In several instances, the said investments were honoured by the bank and debited to the account of Capital & More Limited, a company owned by the 1st defendant (Essien),’’ they said.

The plaintiffs also accused the defendants of engaging in a “scheme of fraud on its customers, regulators and the public”.

Misuse of BoG’s support

The statement of claim further averred that the defendants “mismanaged and breached banking laws’’, a situation that put the bank in a precarious financial situation.

As a result of the dire financial situation of the bank, the plaintiffs said, between June and November 2015, the BoG granted a GH¢620-million liquidity support to it.

Mr Essien, the statement of claim said, transferred GH¢130 million out of the liquidity support into his personal company known as the All-Time Capital Limited.

“The amount of GH¢130 million remains outstanding and unpaid. The amount was rather used to set up Sovereign Bank, another bank in which the 1st defendant (Essien) had a vested and material interest,’’ it added.

Apart from the GH¢130 million, the statement of claim alleged, the defendants approved GH¢27.5 million for Mr Essein which was used as ‘protocol payment’ or ‘business promotion’ “payment for the receipt of the liquidity support from the Bank of Ghana’’.

Reliefs

According to the statement of claim, all attempts by the receivers to recover the loans from the shareholders had proved futile.

The plaintiffs are, therefore, seeking a declaration from the court that the actions of the defendants were in breach of Act 179.

They also want an order directed at all the shareholders to pay the outstanding loans that they owed.

UT Bank

Meanwhile, the PwC, which is also the receiver for another defunct indigenous bank, the UT Bank, has dragged UT Holdings and UT Logistics Ghana Limited to the Accra High Court in a bid to recover more than GH¢98 million which, it says, are debts owed the bank by the two companies.

According to the writ of summons, UT Holdings and UT Logistics were shareholders of the defunct bank that used their position to secure loans from the bank but had refused to pay the loans, despite several attempts by the receiver to recover them.

“As of August 14, 2017, the 1st defendant (UT Holdings) had an outstanding amount of GH¢51,334,387 and $8,612,829. The second defendant (UT Logistics) also had an outstanding loan balance of GH¢9,313,700,’’ the statement of claim said.