Presidency petitioned over recovery of debt from Engineers and Planners
The Merchant Bank may have been stopped from recovering huge debts owed it by Engineers and Planners.
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But in a rebuttal, the Minister of Information and Media Relations, Mr Mahama Ayariga, said the President was not personally involved in the case nor tried to stop Merchant Bank from retrieving its debt.
Engineers and Planners is owned by the President’s brother, Mr Ibrahim Mahama.
“As the controversy over the sale of Merchant Bank to Fortis continues, it has emerged that the Presidency was petitioned to intervene in the matters surrounding the recovery of huge debts from Engineers and Planners, a company owned by Ibrahim Mahama,” a Joy news report has suggested.
The report said lawyer for Engineers and Planners, Mr Tony Lithur, petitioned the President to intervene on the company’s behalf.
Reacting to the report, Mr Ayariga stated that President Mahama’s intervention was triggered by the petition brought to government’s attention and that “President Mahama never directed the bank and its board as to what to do.
He insisted that “President Mahama will not stand in the way of Merchant Bank to retrieve their money even if the person was his brother” and that his intervention was to give the parties hearing regarding the petition.
Mr Ayariga explained that the firm was given the loan during Kufuor’s Administration and given five years but this was varied unilaterally to three and that the petitioners felt that it was politically motivated, hence their decision to appeal to the President.
The bank had attempted to recover a debt of $38 million from Engineers and Planners.
According to the report, the bank’s board described the debt in a letter to the President, in response to Mr. Lithur’s petition as constituting 30 per cent of its 50 per cent non-performing loan portfolio.
It said in that letter, the Merchant Bank Board referred to various meetings its chairperson had had with President John Mahama and his predecessor, President John Mills where they were asked on one occasion to explain to President Mahama why they refused to release funds to Engineers and Planners to meet their operational cost.
After months of defaulting on its loan, Merchant Bank wrote a final letter to Mr Ibrahim Mahama on June 18, 2012 demanding repayment of a loan the company took from the bank but failed to pay on the due dates. It threatened to resort to legal action to retrieve the money if E&P failed to pay up.
It said the threat probably triggered a petition to the President through the National Security Advisor by Mr. Lithur dated 4 July, 2012 and was received at the office of the President on 13 of July, 2012.
Source: Joy FM