Business News of Tuesday, 14 March 2017
The President of Groupe Ideal, Nii Kotei Dzani, has called on the Bank of Ghana (BoG) to sanitise the operations of financial institutions in the country.
According to him, the financial sector was disorganised because some microfinance institutions were operating like commercial banks, while others were working without the required capital as prescribed by the central bank.
“One of the problems that we face as financial institutions in the country is that there is no clear definition of the functions of various financial institutions.
There is no differentiation in operations as a savings and loans company and a commercial bank. Microfinance companies are operating like commercial banks. Now it is only the forex that differentiates a commercial bank from a savings and loan company,” he said.
He added that, “There are microfinance companies that do not even have the necessary capital and yet they operate like the commercial banks; they operate like savings and loans companies; and there are money lenders that work like finance houses,” he added.
At the launch of the Ideal Sika Fund in Accra last Thursday, Dr Dzani said the development was a risk to the financial sector posed a danger to public funds particularly and the industry in general.
According to him, that was because the investing public did not know the difference, “so what happens is that they treat all of us almost the same.”
He added that when one unscrupulous microfinance company squandered people’s money, the rest were also affected by the negative perception.
Clear definition of roles
Dr Dzani, therefore, called for a proper definition of the roles of financial institutions to prevent some of the institutions from veering off their core mandate.
That, he said, would also streamline the operations of financial institutions to enhance inclusion and further prevent debacles that may lead to loss of funds.
He said Groupe Ideal had been one of the best brands in the country, noting that one of the core values of the Groupe was to promote the interest of the customer with integrity and innovation.
The Managing Director of Ideal Capital Partners (ICPL), managers of the Ideal Sika Fund, Mr Emmanuel Tackie, explained that the fund was an open-ended money market mutual fund which sought to provide regular income while preserving capital and maintaining liquidity by investing in fixed securities and other money market instruments.
He said the initial public floatation of the fund was offering a minimum of one million shares at 20 pesewas per share.
“For the Initial Public Offer of Ideal Sika Fund, we have set aside one million shares. All you need to do is to initially deposit GH¢50 to own 250 shares. Then top up with GH¢10 or 50 shares thereafter,” he noted. The offer started on March 9, 2017 and closes on March 29, 2017.
Securities Industry Act, 2016
The acting Director-General of the Securities and Exchange Commission (SEC), Mr Alexander Williams, said the Securities Industry Act, 2016 had been presented to his office.
He said the Act provided the legal framework for the securities industry to license all forms of securities and the operational independence it needed for the efficient regulation of the industry.