Ivory Finance spills beans on SIC’s GHC550m debt

The Executive Chairman of Ivory Finance Company Limited, Emmanuel Adu-Sarkodie, has described claims that SIC Insurance Company Limited has paid GHC91 million to Ivory Finance as a refund of a loan SIC guaranteed for a real estate company as false.

He told journalists in Accra the only money SIC has paid to Ivory Finance so far is GHC19.3million, which they paid to the court and the court transferred to Ivory Finance as part payment of money owed since 2013.

Emmanuel Adu-Sarkodie noted that four years after Ivory Finance advanced the loan to Ital Construct International Limited with SIC as guarantor, the interest has piled up to over GHC550 million and it is still rising every month as SIC continues to fight the matter in court.

Ivory Finance has also garnisheed all the assets of SIC and Ital pending the refund of the debt, to the extent that, now SIC directors had to seek the permission of Ivory Finance through the courts before they could use their own vehicles.

The facts of the case are that SIC guaranteed a sixth-month bridge finance of GHC14 million from Ivory Finance for Ital on March 26, 2013, for the construction of 4,100 affordable houses.

The terms of the loan were 5.5 per cent interest when paid within the six-month period, but in default, an additional eight percent will be added to make 13.5 per cent for every month of default.

According to Adu-Sarkodie, when Ital named SIC as a guarantor “we did not have any qualms because SIC had in the past guaranteed similar loans for two of our mutual clients and the money had been paid back without any problems.”

He said in this particular instance, however, Ital defaulted in the repayment of the loan so Ivory Finance made a demand on both Ital and SIC on October 1 and 18, 2013, but to no avail.

SIC sued

Ivory Finance, therefore, filed a suit on November 2, 2013, at the Commercial Division of the High Court demanding the money, and the court ruled in their favor allegedly because of a loose defense from SIC.

At the time of the ruling, the money owed had reached over GHC91.9 million so SIC appealed for stay of execution, a freeze on the interests and a reduction of the outstanding amount, but Ivory Finance refused to reduce it so SIC agreed to pay the outstanding amount in nine months, while the interest remain frozen.

The terms of the settlement, which was signed by the then SIC Managing Director and Secretary to the Board, was entered into a consent judgment in court but the period passed and SIC still defaulted on the repayment on the outstanding GHC91.9 million so the interest was unfrozen again.

Fraud claims

In the heat of the back and forth, SIC sued Ivory Finance claiming they used fraudulent means to getting SIC entangled in the mess because they made SIC MD and Board Secretary sign the bond on the blind side of the board.

The High Court threw SIC’s case of fraud out and they went to Appeals Court and lost again, and now they are at the Supreme Court with the same case of fraud against Ivory Finance as the interest on the loan continues to pile up.

Meanwhile, some surrogates of SIC are in the media claiming that SIC had paid GHC91million to Ivory Finance but the company has still garnisheed SIC assets and accounts in an attempt to take over SIC.

But Emmanuel Adu Sarkordee said it is a complete lie that SIC has paid any such amount to Ivory Finance, emphasizing that SIC paid only GHC19.3 million through the court to Ivory Finance.

Hidden from shareholders

The Ivory Finance Boss, who said he is also a shareholder in SIC, described the SIC Board and Management as irresponsible and deceptive because while they claim they had paid GHC91 million to Ivory Finance, they did not report that to shareholders at the AGM last year.

“They also never mentioned in their account statement that they owe GHC91million – they did not even make a note of that possible liability and yet they paid out deceptive dividends to shareholders,” he said.

On claims that he was seeking to take over the ownership of SIC, Sarkordee rubbished the claims saying that he had no intention of owning SIC but he believes the way they are managing the “iconic brand” called SIC is not the best.

He said currently, the Bank of Ghana has allowed Ivory Finance to write that loan off its books because it was sold to another investor, so it will not affect its shareholders and customers.

“Customers and shareholders can rest assured that this loan will not affect their investment in any way – but we will still continue to demand the money until it is paid because it will help to expand our business and help to employ more people,” he said.