Ezi Savings and Loans to receive bailout
The embattled Ezi Savings and Loans Company is expecting a bailout from its majority shareholder to ease the liquidity problems it is going through, a source has told the B&FT.
Four branches of the bank which were shut down on Thursday reopened partially to the public on Monday. The temporary closure was necessitated by a run on the bank by depositors, which seems to have persisted for weeks.
Officials of the Banking Supervision Department of the Bank of Ghana, the regulatory body who spoke to the B&FT yesterday, said they are in talks with management of the beleaguered company regarding the way forward.
They confirmed they have been told of efforts being made by the bank’s majority shareholder to intervene in the liquidity problems the bank is facing.
“We are paying close attention to the measures being taken by the bank to address these challenges. As much we can, we are also offering them advice on how to solve their problems,” an official of the central bank said.
When B&FT visited the Kaneshie branch on Monday afternoon, scores of customers had gone there to withdraw their deposits.
Some customers who spoke to this paper were unhappy about the bank’s inability to pay them their funds, a situation that is hurting their businesses.
Although management of the financial institution promised to fully resume operations yesterday, B&FT’s checks revealed that the branches at Kaneshie and Nungua were only taking deposits and not paying funds to clients.
Ezi’s Marketing Manager, Tinawura Ivy Satuh, said there was “uneasy calm” at the affected branches when they reopened on Monday morning.
“The situation at Nungua, for instance, is calm and we are taking deposits from our customers. We need these funds in order to settle our obligations to our other clients,” she said.
The situation, which started more than a month ago according to officials of the company, developed when it attempted to switch its Internet service providers. The transition led to glitches, which meant that some customers were not able to access their money due to a network breakdown.
Officials of the financial institution described the subsequent rush for deposits by clients as a panic withdrawal triggered by rumours that the institution was facing an imminent shutdown — a situation that is very familiar in the microfinance sector of the country.
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