Press Statement By THE COALITION FOR THE PROTECTION OF INDIVIDUAL LIBERTIES AND CONSTITUTIONAL RIGHTS (COPCOR) ON THE SALE OF SSNIT SHARES IN THE TRUST BANK TO A FOREIGN BANK.
Good morning, ladies and gentlemen of the press, you are welcome to today’s press briefing which is specifically on attempts by the Social Security and National Insurance Trust to sell its 61% shares in The Trust Bank (TTB) which is currently the third largest local bank (coming after GCB and ADB) to a foreign bank, Ecobank Transnational Incorporated (ETI).
The Coalition for the Protection of Individual Liberties and Constitutional Rights (COPCOR) has been reliably informed that some individuals on the Board of SSNIT are opposed to this transaction because it is not in the interest of the nation but the SSNIT board chairman and the Director General appear to be the brains working in favour of such a dubious move. SSNIT has therefore appointed three new members to the board of TTB whose main task is to help push the deal to a successful end before the close of this year. These new board members include Mr. Daniel Kwabla King as the new Chairman of the TTB Board; Mr. Daniel N.O Sackey – Director and Capt. Rtd Assassie Gyimah – Director.
The new appointments came immediately after SSNIT withdrew two former members from the board of TTB, namely Mr. Kojo Okai Andah who is the current Director of DNL and Thompson K. Abu-Bakr Bibilazu, formerly of MDPI.
After their appointments, the new board of TTB was coerced by SSNIT to meet on June 10, 2011 to discuss the proposal by SSNIT to sell TTB to ETI. Information reaching (COPCOR) indicates that the board of TTB concealed the true intentions of SSNIT from the minority shareholders of TTB and rather presented the case as if they (SSNIT) were pursuing a merger course instead of the sale arrangement agreed between SSNIT and ETI. All these took place at a time that the Central Bank was yet to approve the 3 new directors in consonance with laid down regulations for appointing board members for banks, in order to make them become legitimate members of the TTB board.
Ladies and gentlemen of the Press, we are also aware, that SSNIT is frantically pushing for the deal with Ecobank without the knowledge of government. It s worth noting that being a government agency, with the state’s vested interest; any such transaction should require government Cabinet’s express consent since such a move could result in adverse consequences to all stakeholders, including government and the workers of Ghana who pay SSNIT contributions monthly.
Without receiving approval from cabinet, we are reliably informed that SSNIT has already appointed Strategic African Securities (SAS) whiles ETI have, on their part, appointed PriceWaterHouseCoopers (PWC) through Ecobank Development Corporation (EDC) to serve as transaction advisers. This deal must not be allowed to continue and we are calling on government to step in now to stop it before it is too late.
With these developments, we are wondering what could be influencing SSNIT which holds majority stake in TTB to be so eager to sell the 6th largest bank in Ghana with GHC122Million in shareholders’ funds without any convincing reason, except to claim that they intend creating the biggest bank in Ghana from this sale. It is instructive to know that TTB has traditionally been one of the few top performing banks, with very high Return on Assets (averaging about 4% per annum) as well as high Return on equity (averaging over 36% per annum) for the past decade or so.
We call on SSNIT to publish the records they have regarding their investment holdings in every bank in this country to convince the good people of Ghana why they intend selling TTB. We deserve to know their investment sums as well as the returns from each bank for the last 10 years. This will bring to bear their true intentions on this bad transaction.
We know for sure that this proposed sales transaction (clothed under the name of a merger) is being fuelled by one big individual (name withheld) who’s vested interest does not conform generally to that of our party and the ruling NDC government.
Ladies and gentlemen of the press, TTB is in good standing as it has met the central bank’s mandatory minimum capital requirement of GHC60million; the Bank was the first bank in Ghana to have exceeded the required minimum by generating over GHC66million additional capital from a Rights Issue announced in 2009. That exercise alone brought the total stated capital of TTB to over GHC91million and shareholders’ funds to over GHC122 million at the close of the 2010 financial year, two years ahead of the GHC60million deadline set by the Central Bank. This underscores the confidence that all shareholders of the bank have in its performance. We must emphasise that the additional injection was more than enough to set up a new bank.
COPCOR is particularly unclear about the hasty preparation being made towards the planned sale. Ghana also deserves to keep one of the best performing banks as her own and TTB should not be left to go into the hands of foreign owners. If SSNIT cannot continue to hold its 61% interest in TTB, they should tell Ghanaians now so that we would together explore the possibility of getting indigenous investors to buy off their excess share to ensure that TTB remains a Ghanaian bank.
We must have confidence in the wholly Ghanaian management team that has professionally managed the bank this far. Sources at the Banking Supervision Department of the central bank indicate that “TTB is one of the best managed banks in the country, always taking risk management and corporate governance to higher levels all the time”.
SSNIT will have to come very clear in this ill-intentioned transaction, which is not in our interest as Ghanaians and is also very likely to affect the image of the government. Elections 2012 is just around the corner and we, the members of COPCOR will not stand-by unconcerned whiles a few greedy ones continue to pursue their paroquial interest . We will do everything to resist this move to sell TTB.
There seems to be more questions than answers and we members of COPCOR will like to pose the following questions:
• As the majority shareholder, what role did SNNIT play in the earlier merger talks between TTB and Merchant Bank, which was aimed at creating a bigger local bank in Ghana?
• Why will SSNIT not consider consolidating their bank investments in a single local bank with excellent efficiency such as TTB but rather want to sell the proverbial hen that lays the golden eggs?
• What should be the priorities? Explore avenues to enable the smaller banks with SSNIT interest meet the GHC60million deadline or rush into selling off the most efficient local bank that is under no threat of any kind?
• Why did SSNIT join hands with the other shareholders of TTB to inject fresh capital into the bank in 2010 only to want to sell off the same bank from the first quarter of 2011 following the appointment of new board members?
• Why did SSNIT misrepresent the facts to the minority shareholders of TTB concerning this sales arrangement and rather made it look like a merger?
• Was it the intention of SSNIT to circumvent the “first right of refusal” rule in the eyes of the minority shareholders as well as the BOG, in order to push through the deal without the minority shareholders raising any objections?
• Is it true that ETI is currently working through its appointed transactions advisors, PWC, to undervalue TTB in order to buy it cheap?
• Is it also true that ETI intends to make proposals to the minority shareholders to buy off their interest after settling with SSNIT?
• Is it true that SSNIT bullied the other shareholders with their might, by not allowing them to exercise their pre-emptive rights (rights of first refusal) before considering the sale to ETI, bearing in mind that SSNIT had earlier benefited from such rights when the then majority shareholder (Banque Belgolaise of Belgium) proposed to sell their interest to Bank of Africa (BOA)?
• By the way, why was SSNIT pushing for the erstwhile board of TTB to appoint Mr. Charles Asare, formerly of SSNIT, as the bank’s new Managing Director in the last quarter of 2010?
• What was the motivation, and who was behind that proposed appointment of Mr Charles Asare?
We beg of government, the media and the TUC to demand answers to these questions from SSNIT as a matter of urgency. What is good for ETI is also very good for the people of Ghana and we must all join hands to stop these greedy individuals from benefiting from our sweat, as the workers of this great country pension funds are being toyed with by SSNIT.
COPCOR is calling on SSNIT, as matter of urgency, to back down on this planned sale of its shares in TTB to ETI and allow this local bank to perform and grow naturally on its own since it currently faces no threats for survival and is one of the most performing banks operating in Ghana today.
We end this by calling on his Excellency, President J. E. A. Mills to take prompt action on this matter by getting personally involved. He must however be careful of some of his advisors on this particular matter before the drama begins to unfold.
TTB must not be sold to a foreign institution. The bank must remain Ghanaian and contribute the national pride of this great nation.
This is just the beginning.
Long live COPCOR!!
Long live mother Ghana!!!
Thank you and God bless you all
