No agreement covers BoG loan to GCB

A $75-million loan granted by the Bank of Ghana (BoG) to the Ghana Commercial Bank (GCB) in 2009 without any valid contractual agreement became the topic for discussion at last Friday’s sitting of the Public Accounts Committee (PAC) of Parliament.

The BoG granted the cedi equivalent of $25 million and $50 million bridging facility to the GCB under a memorandum of understanding (MoU) on February 19, 2009.

Although the agreement expired six weeks from February 1, 2009, an outstanding balance of the cedi equivalent of $50 million remained unsettled as of December 31, 2010.

According to the Auditor-General’s Report on public boards, corporations and other statutory institutions for the year ended December 31, 2010, there was no new agreement or addendum established with the GCB to extend the terms and conditions contained in the MoU, which expired on March 31, 2010.

“The absence of a valid loan agreement and contracts to govern the facilit