Work begins on Exim Bank

Implementation of processes for establishing an Exim Bank, Ghana - which will lead to harmonisation of EDAIF, Export Finance Company and EximGuaranty Company - has begun in earnest.

“A technical or transition committee is already working on integration modalities for smooth implementation,” Felix Ntrakwah-Board Chairman of EximGuaranty Ghana, disclosed in Accra during the company’s Annual General Meeting.

“We are reliably informed that the Exim Bank Board has been constituted, and we await the announcement soon,” he said.

According to Mr. Ntrakwah, his outfit is doing its best to meet all legal requirements expected to facilitate the integration process.

“The law has been passed and I understand a board has been constituted. The transition committee is working on the integration process. If that happens, Exim will assume a different shape in terms of what can be done by bringing the three institutions together,” Mr. Ntrakwah added.

He however noted that the final policy will be decided by directors of the ‘real’ Exim Bank. In terms of policies, he further said shareholders will be informed in due course.

The aim for establishing the Ghana Exim Bank is to create an institution that consolidates past efforts and becomes the key engine for developing Ghana’s exports sector.

The bank, which is to be a non-deposit-taking institution, will assist exporters to compete internationally by providing insurance and financial facilities in support of their activities.

The proposed bank is also aimed at accelerating Ghana’s drive toward achieving a more diversified economy to help the country become resilient to external shocks, and helping improve the country’s capacity to produce goods and services in the competitive global marketplace.

It will operate as a quasi-government institution and act as an intermediary between government and exporters to issue export financing.

Eximguaranty’s 2015 performance

The performance of EximGuaranty Company for the 2015 year shows a decline in total value of guarantees issued by 59 percent, and total guarantee fees amounting to GH?1,448,264 -- representing a decline of 4 percent. Overall revenue however inched up by 10 percent, from GH?6,302,527 in 2014 to GH?6,828,648.

The Chairman stated that “fees and revenue would have been better but for Ghana Cocobod’s decision not to accept guarantees from Non-Bank Financial Institutions”, as total assets dipped to GH?16,319,794 in 2015 from GH?19,310,355 the previous year.

Total investment income however grew by 14 percent, from GH?3,547,535 in 2014 to GH?4,047,244 during the year under review.

Going forward, Felix Ntrakwah indicated that: “The future depends on what becomes of the Exim Bank; If the directors decide that EximGuaranty should be liquidated because its functions are being taken over by Exim Bank, that will be the future; but if they decide EximGuaranty should exist separately but be owned by the new bank, then that will be the future. So various scenarios will be considered in terms of what will become of EximGuaranty”.