There's no law for bipartisan probe of collapse of UT, Capital Banks – Lawyer

The bipartisan probe, being demanded by NDC MPs, into the circumstances leading to the collapse of UT and Capital Banks has no real legal foundation, a private legal practitioner says.

Nii Arday Clegg insists the country’s laws do not proffer any bipartisan political solutions to such financial transactions.

He said Ghana as a country may choose such a process but currently, he told Evans Mensah on Joy FM’s Top Story Tuesday, the country's laws are clear on who to investigate matters affecting the banking sector, and a partisan probe is not provided for in the law.

He cited the Companies Act (Act 179) and the Banks and Specialised Deposit-Taking Institutions Act 2016 (Act 930) as important laws that guide businesses in the country, stressing the latter has consolidated the country's banking laws.

The Minority in Parliament has called for a bipartisan investigation into the reasons behind the collapse of two indigenous banks, UT and Capital Banks. The two banks started operation in 2009 but after eight years, the Central Bank said they are too distressed financially to exist as autonomous institutions.

The Bank of Ghana gave its approval to the "purchase and assumption (P&A)" transaction between the two banks and GCB Bank on Monday.

The NDC MPs at a news conference in Accra said the reasons for the collapse of the two companies must be made clear and public through investigations to be conducted by a bipartisan body made up of MPs of the two main political parties.

"We strongly urge these three institutions, (BOG, GCB, and PwC), and the Ministry of Finance (MoF)...to ensure strict adherence to the distinct benefit of the purchase and assumption (P&A) transaction, so that no single depositor loses his or her investment," former deputy Finance Minister, Casiel Ato Forson said.



Although Mr Clegg believes the demand by the opposition lawmakers could be done under certain circumstances, he said it has no legal backing.

The private legal practitioner also said there is a misconception that directors of banks are at post to receive fat allowances, which does not match the work they do. This, he said is false. He explained directors of banks have "fiduciary roles" under the law to discharge.

"The directors have duty of care and duty of loyalty" which must be executed faithfully, diligently and with tact, he said.

He supported the internal investigations being conducted by the Central Bank to ascertain the cause of the collapse of the two banks.