{"id":597153,"date":"2019-03-07T22:30:48","date_gmt":"2019-03-07T22:30:48","guid":{"rendered":"
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The Minority in Parliament says <\/span>government\u2019s<\/span><\/span> decision to establish the Ghana Amalgamated Trust (GAT) to help some local banks meet minimum capital is illegal. <\/span><\/p>\n

Deputy Minority Leader, James Klutse Avedzi, says unless <\/span>government<\/span><\/span> properly establishes the Trust by seeking parliamentary approval, they will not back the request for a sovereign guarantee.<\/span><\/p>\n

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\u201cWe have few issues that <\/span>need<\/span> to be clarified and the committee which is still working on that is demanding number of <\/span>documentations<\/span><\/span>. First of all, GAT is alien to Parliament and we don\u2019t know what it is\u2026is it a company set up by who? <\/span><\/p>\n

\u201cWhy do you introduce a company that is alien to Parliament and bring it for us to work and give it a sovereign guarantee to go and borrow money,\u201d he quizzed. <\/span><\/p>\n

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GAT\u2019s formation and debt sale come in the closing stages of a sector cleanup during which lenders had to raise their capital holdings, a process which cut the number of banks by almost a third to 23.<\/p>\n

Government created it as a special-purpose vehicle which will use a debt sale\u2019s proceeds to purchase shares in five lenders and help them meet a minimum capital threshold of GH\u00a2400 million.<\/p>\n

Government is to start a debt sale this month to prop up lenders as authorities seek \u00a22 billion ($403 million) in finance for\u00a0undercapitalized banks.<\/p>\n

Related:\u00a0Ghana to start $403m debt sale for\u00a0GAT\u00a0Feb.18<\/p>\n

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Finance Minister, Ken Ofori-Atta<\/b><\/p>\n

The beneficiaries are National Investment Bank Ltd., Agricultural Development Bank Ltd. UMB Bank Ltd., Prudential Bank Ltd. and the merged entity of BSIC Ghana and Omni Bank Ltd.<\/p>\n

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But the NDC MPs say they will\u00a0not support plans by <\/span>government<\/span><\/span> to get parliamentary approval for a \u00a22 billion sovereign bond for the initiative.<\/span><\/p>\n

Their action follows the Finance Minister, Ken Ofori Atta, laying a document in Parliament requesting approval for the sovereign guarantee on Friday, which has been referred to the Finance Committee. <\/span><\/p>\n

He explained that when <\/span>government<\/span><\/span> went for bond for Energy Sector Levy Act (ESLA), the special-purpose vehicle used to raise funds for the energy sector, its basis was the Act passed by Parliament. <\/span><\/p>\n

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Mr Avedzi said ESLA has the legal backing to go and raise a bond or loan.<\/span><\/p>\n

\u201cIn this case, we have not established or given the authority to <\/span>government<\/span> <\/span>to\u00a0establish<\/span><\/span> any company for Ghana,\u201d he stated. <\/span><\/p>\n

The <\/span>Ketu North<\/span> MP said the Minority will raise an objection when the time comes for the debate for such approval, for\u00a0<\/span><\/span>the records to capture that. <\/span><\/p>\n

He also raised other issues related to GAT questioning the selection criteria of the banks which were deemed to have qualified. <\/span><\/p>\n

\u201cAre they the only companies that need support? What <\/span>is<\/span><\/span> the legal basis for that,\u201d he queried.<\/span><\/p>\n

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