General News Thu, 10 Jan 2019

NAGRAT questions use of private pension funds to support local banks

The National Association of Graduate Teachers, NAGRAT is worried about a decision by the government to permit the use of private pension funds into funding some of the country’s struggling local banks through a specially created entity called the Ghana Amalgamated Trust (GAT).

The Association is suspicious of government’s intentions on the deal. The National President of NAGRAT, Angel Carbonu in a Citi News interview expressed regret that there has not been any official communication from the government to workers who own the fund.

He said the decision by the government is against the will of workers.

“We are very apprehensive about this new scheme that government wants to introduce. We see the Ghana Amalgamated Trust as just a conduit institution being established by government to channel workers’ pension funds to financial institutions against the will of workers. As we speak, there is no single document that has been placed before the owners of the fund. The money does not belong to government,” he said.

The Bank of Ghana at a press conference last week to present updates of its reform within the banking sector revealed that a special purpose vehicle, the Ghana Amalgamated Trust has been created to support some struggling banks.

It said GAT is an arrangement of private pension funds to inject GH¢2 billion into supporting solvent and well-run indigenous banks, which were otherwise having difficulties meeting the new minimum capital requirement of GH¢400 million.

The banks selected to benefit from the package are the merged Omni/Sahel Sahara Bank, Universal Merchant Bank, Prudential Bank, ADB and NIB.

But some pension contributors are apprehensive over the move as they are uncertain about how it is going to succeed.

Meanwhile, the Chief Operating Officer of Dalex Finance, Joe Jackson is casting doubts over the ability of Ghana Amalgamated Trust Limited to generate enough funds to revive some struggling local banks.

He expressed worry that the political nature of the entire arrangement will make it unattractive for potential investors.

Source: citinewsroom.com
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