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Where Is The $400m First Rand Booked In Ghana Business?

Where Is The $400m First Rand Booked In Ghana Business?

Sat, 12 Apr 2014 Source: Tawiah, Francis

According to First Rand chief executive, Sizwe Nxasana, South African lender First Rand invested $400 million in Ghana last year, and is re-evaluating the business case for opening operations in Kenya.

Africa's second-biggest bank by market value has scaled back its presence elsewhere across the globe to narrow its focus on Africa, where it already has businesses in countries such as Nigeria, Zambia, Mozambique and Tanzania.

The chief executive of the South African Bank said, "The $400m First Rand booked in Ghana Business went into agriculture, mining and real estate." First Rand was also applying for a banking licence in Ghana.

The money was a combination of its corporate and investment unit's lending and property-related investment through third party funds as well as the bank's money.

First Rand currently has a representative office in Kenya, which it set up in 2012 initially to book infrastructure and project financing deals and to scout for an acquisition. It hoped Kenya's position on the continent's east coast would allow it to make a play for the fast-growing Africa-India trade corridor.

The bank also has an Indian retail business, operating in Mumbai neighbourhoods. Because of overstated valuations in Africa, First Rand now prefers to set up operations elsewhere on the continent from scratch, instead of making large acquisitions.

The South African Bank abandoned talks to acquire a majority stake in Merchant Bank Ghana for over $90 million last year, because of NDC government's conflict of interest.

Nevertheless where is the $400m First Rand booked in Ghana Business, which according to the chief executive of the South African lender, First Rand, went into agriculture, mining and real estate?

Why are farmers, fisher and miners in the Country still crying for technological/technical and financial assistance from the government?

FRANCIS TAWIAH (Duisburg - Germany)

Columnist: Tawiah, Francis