A former Deputy Governor of the Bank of Ghana (BoG), Emmanuel Aseidu-Mante has stated that the Central Bank has no right to impose any sanctions on HFC Bank in the tussle for the control of the bank.
He said issues concerning shareholders could be effectively resolved at the Annual General Meeting (AGM), Emergency Shareholders’ Meeting and the courts, as in the case of HFC Bank.
‘The Central Bank has no power over that,’ he added.
Mr. Aseidu-Mante’s position, which he stated in an interview with Citi FM recently, differed sharply from that of the current governor, who had threatened to impose sanctions on HFC Bank, claiming the Central Bank could issue directives to the former and even appoint managers to continue to run the bank well.
Critics have raised questions as to why the Social Security and National Insurance Trust (SSNIT) is bent on replacing the three board members of the bank at an Extraordinary
General Meeting (EGM) just two months ahead of the bank’s AGM.
The BoG recently intimated that HFC Bank was being managed well.
‘Why can’t SSNIT not wait to replace the directors with its preferred choices at the AGM due in April 2015? The hurry here is very interesting.’
According to Mr. Asiedu-Mante, while the responsibility of the Central Bank is to ensure that the commercial banks are solvent, liquid and profitable, its rights and duties are limited to ensuring that the commercial banks are operational and meet customers’ demand.
He said even though the Central Bank also had additional responsibility to ensure commercial banks had good management and appropriate internal controls in place, it could not impose any decisions on a bank.
‘When it comes to wrangling among shareholders, the Central Bank can only advise. It cannot exercise any right over there…’ he stated, explaining that the authorization of the Central Bank only allowed it to ensure that the bank or the company pursued its business on the lines of the provisions in the Banking Law.
Meanwhile, Dr. Wampah has warned that the Central Bank would have to step in to do what the law required should the parties in the tussle fail to reach an amicable solution.
SSNIT, which holds 26 percent shares in HFC Bank, is believed to be working towards the removal of three board members of HFC Bank, including the chairperson, Muriel Edusei and replace them with people of their choice before the end of April 2015.
Media watchers have alleged an EGM requisitioned by SSNIT for the purpose of removing and replacing the board members, and postponed three times already by the courts, is expected to pave the way for the Republic Bank of Trinidad and Tobago (RBTT) to takeover HFC Bank.
Dr. Wampah, during a media briefing at the BoG, said ‘currently, we don’t see that problem, but if it is clear that we are not able to solve this amicably, then we would have to step in and do what the law demands us to do.’
Meanwhile, the Securities and Exchange Commission (SEC) has planned to stall investigation into complaints of alleged ‘Insider Trading’ lodged by two independent board members of HFC
Bank against RBTT, citing the current attempt by the BoG to
mediate between HFC and RBTT and other parties who have
filed complaints on the matter.
But HFC Bank has expressed dissatisfaction with the move. It said although the attempt at mediation was requested by the bank and initiated by the BoG, it was not linked to the complaint of Insider Trading against RBTT.
HFC Bank has called for thorough investigation of the matter by SEC.
By Samuel Boadi
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