Honour your promise: Save local banks – Adongo to Akufo-Addo

Bolgatanga Central MP Isaac Adongo has entreated President Nana Akufo-Addo to fulfil his promise to support local banks to survive.

The Association of Indigenous Universal Banks made a passionate appeal to Mr Akufo-Addo to have the central bank extend the deadline for the GHS400 million recapitalisation, which is 31 December 2018.

The banks said the period given them to recapitalise was too short and posed a risk to their business. A petition signed by the CEOs of all the banks said they could recapitalise to GHS170 million by the end of 2018, GHS220 million by the end of 2019, GHS280 million in 2020, GHS340 million in 2021 and GHS400 million in 2022.

Subsequently, Mr Akufo-Addo was expected to set up a 10-member committee to act on the petition.

Speaking in an interview with Graphic Business, Mr Adongo said the president “promised to set up a 10-member committee made up of representatives from the Bank of Ghana (BoG), Ministry of Finance and the Office of the President to report to him in two weeks to enable him to announce and implement his government’s support to the local banks. It's been 8 months since he made the promise without any announcement and support to the local banks”.

Mr Adongo stressed that “with just about two weeks to the deadline, I entreat the president to redeem his promise and save these banks. He should not supervise the collapse or consolidation of any more local banks”.

The deadline for the GHS400 minimum capital requirement is 31 December 2018 and several indigenous banks are making frantic efforts to raise the funds or merge to meet the requirements.

First Atlantic Bank and Energy Commercial Bank recently had the green light from the central bank to merge.

The two banks began the process after Energy Commercial Bank failed in its bid to raise GHS340 million via the stock market; and with the BoG issuing a ‘No Objection’ to the talks, this means the two institutions can now proceed to conclude talks before the 31 December deadline.