Bank of Ghana on August 1 announced the creation of the Consolidated Bank Ghana Limited after it dissolved five ailing banks – Sovereign bank, BEIGE Bank, uniBank, Construction Bank and The Royal Bank.
According to the Governor of BoG, Dr. Ernest Addison, some of the banks obtained their licenses through false means by presenting documents that painted a picture as though they could meet the new capital requirement.
In his explanation, he said BEIGE, Sovereign and Construction Bank obtained their banking licenses under false pretences through the use of suspicious and non-existent capital. uniBank had a capital deficit of GHC7.4 billion, compared to the regulatory minimum of GHC400 million and The Royal Bank non-performing loans were high which constituted 78.9% of total loans granted.
This has however generated controversies by politicians and economists in the country blaming BoG for the collapse of the five banks. Parliament’s Finance Committee has threatened to drag before the House, Governor of BoG over the collapse to explain the occurrences in the banking sector as to why seven banks have gone under in just a year.
Also, reports indicate that the government intends to cancel the revised power agreement with Dubai-based AMERI. Details of the renegotiated contract which indicated that government would make annual payments of $75m for 15 years ignited public outrage.
Under the original arrangement, the nation is contacted to pay $102m for five years. It emerged that President AKufo-Addo was misled into granting executive approval for the deal under the guise of there being an urgent need to have a bill laid in Parliament before its rising.
Under the proposal, the Greece-based Mytilineos International Trading Company was to assume management responsibility for the AMERI emergency power-generation arrangement negotiated by the past NDC government, in effect extending the original outsourcing agreement by ten years.
On his return to Accra on Tuesday from the 53rd session of the ECOWAS Heads of State meeting in Togo, the President quickly requested and received a further briefing on the new deal. This revealed that the agreement to which he had approved on July 31 lacked the requisite input from the Attorney General and the Ministry of Finance. The President had been misled to believe that both departments had assessed the deal thoroughly.
Other issues to be discussed in today’s edition of Newsfile will be on the Sinohydro deal between Government of Ghana and the Chinese government to exchange the country's bauxite for infrastructural projects, the swearing-in ceremony of the new EC Commissioner, Jean Mensa.
Watch a livestream of the programme here: