Ghana Begins To Move On Toxic Loans

Stung by the drastic actions of the Economic and Financial Crime unit and the revolutionary cleansing role of Lamido Sanusi (Central Bank of Nigeria Governor) in dealing with the culpable actions of top bank chiefs in Nigeria, attention has riveted to Ghanaian banks and financial institutions, and the ‘donkey-like’ attitude of its outgoing Governor, Dr. Paul Acquah.

His lackadaisical and notoriously lukewarm style on banking infractions has come under attack nature, as he is seen as preferring to yawn at the wheels as the banks perilously careers to an implosion. Dr. Acquah’s attitude towards the sector, in the face of a similar ‘Nigerianisation’ of the nation’s banks have drawn widespread disquiet from the industry watchers, until it became just too much when a whole bank’s chief Executive turned to a teller and exchanged fake foreign currency notes in his bank’s vault, and carried off to the Central bank. Wale was simply waved off the bank and Dr. Acquah never called in the police to take him away.

No charges were pressed against him, when Lamido would have called in the Bureau of National Investigations to cart off for a taste of Kokonte, but Acquah failed the Ghanaian customers when he did not so much as sanction him for this outrageous crime. Fact is, Amalgamated Bank had been taken over by Oceanic Bank, which is one of the banks that was in the sights of Lamido Sanusi, and remains under the eagle eyes of Nigeria’s Economic and Financial Crimes unit.

The very political Nigerian High Commissioner to Ghana, His Excellency Obanikoro, tried his political best to douse the flame over the scandal by playing it down, because the Managing Director,Wale, is a Nigerian with loads of petrodollars to spray. From the opposition New Patriotic Party’s (NPP) senior parliamentarian - Honourable Hackman Owusu Agyeman, has been calling for an ombudsman for the banking industry in the wake of growing fraud and toxicity within the comity of bank.

Even as the Governor begins to pack out of the High Street, he maintains a taciturn presence actuated more by his bankers’ training and his years of patient tutelage at the International Monetary Fund, and the need to maintain equilibrium in the sector, despite leaping inequities, toxic balances and padded accounts by Ghanaian banks, which he very well knows, unlike Sanusi.

But then again, he may be guarding his generous pension package which is guaranteed. His opposite number from Nigeria, over the weekend, toured leading financiers in London, in a bid to alleviate fears over his country's banking crisis. That country’s financial sector has been in crisis since Mr Sanusi sacked heads of several banks, accusing them of mismanagement and accumulating billions of dollars in bad debt.

Currently in Ghana, a few financial institutions have come up for examination, among them Fidelity Bank, one of the few private banks to emerge in the middle of the booming financial tide for such institutions. And then the Agricultural Development Bank (ADB), the most troubled of the banks; including the nation’s most networked bank - Ghana Commercial Bank (GCB), which is alleged to have padded its balance sheet to pass muster by its auditors.

ADB appears to have been in the news, and has featured prominently in the local newspapers, primarily over the damning revelatory letters that have flooded the offices of Dr. Paul Acquah. The bank attracted the ire of Dumega Raymond Okudzeto over the last two years for granting and sustaining a string of erratic loans to the oil magnate - Mr. Nyonyo Agboada and his company - Fraga Oil.

The elder statesman has been bombarding the Governor over the potentially toxic nature of Agboada’s portfolio. Because Dumega Okudzeto was then actively tied to the New Patriotic Party, the then ruling party, his warnings went unanswered. Now Dumega has shed off his political clothes and publicly declared himself as completely free from political association. He has continued to sound a truly distressed warning about the state of our banks, with particular reference to the Agriculural Development Bank and its role as the petty cash safe of a particular customer.

Mr. Francis Nyonyo Agboada, of Fraga oil fame, has piled debts upon debts at the bank, which was becoming toxic, and over the weekend his indebtedness to the bank crossed over what a normal bank could lend – more than his assets. “Since you have decided not to reply to my letters”, Mr. Okudzeto wrote for the third time to the Central Bank Governor, as recently as January this year, and clearly exasperated at the inaction of the Bank chief who is due to retire next month, “I now feel duty bound to write to you once again to plead with you to do the right thing and investigate the affairs of this man at our only Agricultural Bank”, Mr. Okudzeto advised.

The whistle blower - Dumega Okudzeto, hinted the Governor that one of the two main accounts being operated by Fraga oil (which is owned by Mr. Agboada), is hidden from even the senior management team of the bank, because of reasons best known to only the Managing Director, the chairman and one other Director. Last month, the new Government heeded the warnings of Okudzeto and fired the Managing Director. Dumega Okudzeto continued - ‘the same tactics have been repeated in various government organizations, Tema Oil Refinery, CEPS, etc. Why am I concerned and determined to have this man exposed for what he truly is? It is simple. This man siphons money from the system and uses this ill-gotten money to destabilize his place of birth, Anlo”. At an emergency meeting hastily convened by the new board, an apparently born again Ibrahim Adam, ordered an audit of the top 50 worst customers of the bank. There, jumping before the eyes of the board members was Fraga Oil - GH¢179,994,251.07!

In English language, One hundred and seventy nine million, nine hundred and ninety four thousand, two hundred and fifty one Ghana cedis and seven Ghana pesewas. That was made of loans, overdrafts and CA’s , but surprisingly the bank detected that he had paid GH¢ over to National Investment Bank, and turned over his banking business to that bank which is reeling.

None came a close second as the closest second AU DEV. consortium Ltd. and Nulux Plantations Ltd. came second and third on the list of worst performing customers with GH¢ 4,580,314.00 and GH¢ 3,282,642.12 00 respectively. Plantations Development Company Ltd. came fourth, being the worst with a loan of three billion Ghana cedis. Interests on these loans were kept off the register as they amount to eye popping figures. Fraga Oil business is into oil and oil haulage, and has nothing to do with agriculture.

Dumega’s persistent cries to Acquah has come to light, and the man with a sheepish quiet simply retires to his Wassa village for a hero’s welcome, while Mills’ potential chief of staff - Paa Kwesi Amissah Arthur, resumes the hot seat with all the appropriate grounding of a tried and tested finance chief, with a pedigree of careful but sharp instincts, honed by years of experience in the financial sector as deputy Finance Minister, and a family which should have been more famous in public service, but have preferred to fly under the radar.