'Cronyism, square pegs in round holes' responsible for Capital Bank collapse?

A source at Capital Bank, one of two banks, whose operations have been taken over by the Ghana Commercial Bank, say the bank’s collapse is not strange to most people, especially after management consistently ignored warning signs about how the operations were being run.

Bank of Ghana on Monday announced, through a statement, licenses of the two banks have been taken away from them, and their assets transferred to GCB.

“The main offices and branch of UT Bank and Capital Bank will be under the control of GCB bank and will be opened at 1pm today for normal business transactions.”

Since the news emerged, rumors have been making the rounds about the possible reasons that might have led to the collapse of the banks, especially capital. Primenewsghana sources say some senior managers are solely responsible for the poor turn of the bank and despite warning signs given to them, they ignored it.

A former employee, who says he resigned because he was unable to “bear” some of the “strange” decisions taken by management, said competent people were not put at the right places.

“You don’t expect to make good returns when positions that ought to have gone to persons with expertise in the bank are given to members of the church, just because they are known to a “big” man. “

He said the bank’s operations started going downhill soon as those with knowledge in the bank were “sidelined” and their positions occupied by “favorites” of some of the board members.

“We knew this day will come but the when was what we could not tell,” the source said. “It is unfortunate the right persons with the skill to work were bypassed and the jobs handed out to friends and persons know to those in decision-making sector.”

The collapse of the two banks has come as a shock to some members of the public especially when for the past decade, the two have swept back to back banking awards in the country, cementing their status as the best operated banks in the country.

GCB has so far replaced the logos of the two banks with its own logo and has assured customers their savings are intact.