BOG DEFIES MAHAMA -Over Sale Of ICB, Napo Wants Transaction Halted
Despite a petition sent from the Office of the President to the Bank of Ghana (BoG), directing it to “seriously” consider Ghanaian companies in the acquisition of International Commercial Bank (ICB), the Central Bank, The Chronicle learned, has defied the directive and gone ahead to approve the sale of ICB to First Bank of Nigeria (FBN).
President John Dramani Mahama, through his Chief of Staff on August 29, 2013, wrote to the Governor of BoG, Dr. Kofi Wampah, that since the government put premium on the interest of Ghanaians first before any other thing, “the Bank of Ghana is, therefore, requested to be guided by this position in handling all transactions on the acquisition of the ICB.”
But the Central Bank, in a statement titled “Acquisition of International Commercial Bank Ghana Limited” and signed by its Secretary, Andrew Boye-Doe, and released in Accra on September 24, 2013, announced its approval of the sale of the ICB to First Bank of Nigeria (FBN), arguing that the directive was from ICB Financial Holdings AG, the largest shareholder of ICB.
By the terms of the approval, the BoG noted: “FBN is required to offload at least forty percent (40%) of the shares to Ghanaians through private placement and/or the Ghana Stock Exchange, of which, at least, twenty-five percent (25%) should be offloaded by 31 st December, 2014, and the remainder not later than 31 st December, 2016.”
Halt the sale of ICB
The defiant stance of the BoG seems to have irked the Member of Parliament (MP) for Manhyia South, Dr. Matthew Opoku Prempeh, to call on President Mahama to use the powers entrusted him by the Constitution to halt the sale of ICB to FBN, since the move does serve the interest of Ghanaians.
“The President should stop this sale of ICB to the Nigerians and promote the participation of Ghanaian companies,” noted the outspoken law-maker in an exclusive interview with The Chronicle.
According to Dr. Prempeh, the way and manner the Central Bank had handled the sale of ICB was clear enough to conclude that “BoG is working against the interest of Ghanaians.”
He wondered why the BoG went ahead to extend the expiry date (August 25, 2013) in concluding the deal, to give the FBN ample time to submit their bid, when some Ghanaian companies had already submitted theirs and were ready to take over the bank.
“Why is the BoG deliberately sidelining Ghanaian interests in favour of Nigerian interests in the sale of ICB?” he quizzed.
He said since there were so many foreign banks already in the country, it would have been prudent for the BoG to consider a Ghanaian company in the sale of ICB in order to strengthen the economy.
“The foreign banks always repatriate their profit outside the country. They bank in cedis and repatriate in dollars. The worst of it is that as soon as the economy is wobbling, they take their money away. They perpetuate a vicious cycle. If those banks were owned by Ghanaians, would they be taking the dollars away?” argued the Manhyia South MP.
http://thechronicle.com.gh/wp-content/uploads/2013/10/henry.jpg He touted the BoG as a failure regulator which had contributed to the mess the economy was bedeviled with, and called on Parliament to bring it to book.
Dr. Prempeh asserted that the BoG was the only public institution in the country unaccountable to the representatives of the people, whereas in other jurisdictions, the story was different.
He called on the Governor of the BoG, Dr. Kofi Wampah, to “make it a regular feature to come and brief Parliament after every monetary policy meeting, so that he can be subjected to questions.”
He also urged the Trade Union Congress (TUC) to take keen interest in the sale of the ICB to FBN, since their intervention in the sale of GCB had helped to strengthen the Ghanaian economy.
Throwing more light on the sale of the ICB to the FBN, Dr. Prempeh said the BoG should have first, directed the ICB, when it wrote to them about their intention to sell the bank, to offload about thirty percent of its shares through private placement, and or the Ghana Stock Exchange, to enable Ghanaians to be part owners of the bank, before selling the majority shares to either a foreign or Ghanaian firm.
Since the sale of ICB to FBN came to the public domain, many interest groups have spoken against it, with some opting for a Ghanaian firm to make the acquisition.
Think-tank group, IMANI, raised questions about due diligence in the sale of ICB, and wondered whether the Central Bank had made disclosures to the public about all circumstances relating to the sale and approval of ICB shares to FBN, and the evaluation process, as well as the price involved, before announcing its approval among many others.
The inquest was a result of the Financial Times report in its September 19 edition that the Chairman of First Bank “is reported by ETI directors to have been involved in a number of proposed deals, including a debt write-down and asset sales, which have contributed to unease among some of the pan-African bank’s shareholders and executives.”
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