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December 3, 2023

Let’s support indigenous banks – Kweku Baako

Kweku Baako[/caption] Government must create the enabling environment to make indigenous banks more competitive and to survive in the face of stiff competition from foreign banks, veteran journalist Kweku Baako Jnr has stated. The editor in chief of the New Crusading Guide newspaper said it will be out of place to allow such banks to collapse hence the relevant regulatory bodies must fashion out measures to keep the indigenous banks afloat. His comments follow recent news surrounding a leading wholly-owned Ghanaian bank uniBank, when a consortium of financial institutions that control majority shares in the Agricultural Development Bank (ADB), pledged its shares, proceeds, entitlement and voting rights to uniBank. The consortium, led by Belstar Capital – a turnkey project finance and implementation institution, also includes Starmount Development Company Limited, EDC Investments Limited and SIC-FSL. They took up a substantial stake (51%) in ADB’s Initial Public Offering (IPO) in 2016 when the bank announced its plans to go public. “It appears to me that Belster Capital had a mission and objective to help uniBank to raise capital,” Mr. Baako Jnr said on MultiTV’s news analysis show Newsfile. The news raised a lot of concern on the financial market, with the Central Banking saying it requires its blessings before it will be valid. However, Mr. Baako has called on the government to create a condition which prevents the collapse of any indigenous bank “if we can, as much as possible”. “We must be committed to that in principle. Nigeria has too many indigenous banks here [in Ghana] and outside elsewhere…I am not sure how many Ghanaians banks operate in other jurisdictions,” he added. uniBank has clarified that the decision is not a takeover of ADB. “Due to the delayed timeline of the equity investment, uniBank has taken the additional precaution of committing Belstar Capital to their obligation under the share subscription agreement by pledging all shares held by the Belstar led consortium in ADB to ensure that the transaction will be consummated and the proceeds for the sale of shares paid directly to uniBank. “It is against this background that Belstar Capital Ltd and other members of the consortium of shareholders have pledged their shares in ADB to uniBank to demonstrate their commitment to the agreement and the strategic direction of uniBank. “We wish to put on record that the pledge by members of the Belstar led consortium does not constitute a sale of shares to uniBank. It is only a demonstration of commitment by our capital raising partners and must be considered as such,” Chief Executive Officer Dr. Kwabena Duffuor II said in a statement last week. Source: Starrfmonline.com/Ghana]]>

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