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Business News of Monday, 1 June 2015

Source: Justice Lee Adoboe

ADB in senseless expenditure Part 2

by Justice Lee Adoboe

ACCRA, June 1—Further investigations by myakoben.com have come across more worrying information about the wantonness of some levels of expenditure at the troubled Agricultural Development Bank (ADB).

Some of these expenditure are such that they have imposed a high overhead cost on the bank annually, a cost it cannot sustain hence its current situation.

A case in point is the fact that ADB has to cough up at least U.S $ 4000.00, allegedly to pay the Managing Director (MD) Stephen Kpordzie for living in his own private residence instead of the bank’s official residence while working for the bank.

As part of our investigations and inquisitions into the causes of the bank’s current position of non-profitability, it was discovered that, ADB had had its official residence for the MD which is located at Roman Ridge allegedly disposed of in 2011.

Myakoben.com was told by very credible sources that the process to sell that property began in 2010, barely a year after Kpordzie’s appointment as MD and was concluded in 20011.

“The core function of the bank is banking, not property or estates management and so we must divest our interest in these landed properties and concentrate on our core mandate,” Kpordzie argued, according to our sources.

Suffice it to say that instead of the sale of the bank’s landed property resulting in any spectacular annual performances, the bank has rather experienced dwindling fortunes, under the current MD’s watch, hence the attempt to raise capital through an IPO.

The bank is saddled with an annual expenditure of a U.S $ 4000.00 or 15.200 Ghana cedis monthly rent which amounts to monthly rent of U.S $ 48,000 or 182,200 Ghana cedis rent for the MD alone.

Contrary to Kpordzie’s belief and practice, managers of some state institutions have rather found the wisdom in investing in their own accommodation facilities to save such gargantuan costs in future.

The Petroleum Commission which has a core mandate of regulating the upstream sector of the petroleum industry found it fiscally prudent to invest in its own office space along the N1 Highway.

In a similar manner, the National Health Insurance Authority (NHIA) which manages the health expenditure of its subscribers on behalf of the state, has also found it prudent to invest in its own office complex not only in the capital, but also in some districts.

After working from rented premises since 1996 as Scancom Limited, operators of MTN is currently putting up a magnificent edifice along the Independent Avenue, just close to Vanguard Assurance, adjacent to the ADB headquarters which Stephen Kpordzie and his Board of Directors have earmarked for sale for a paltry U.S $ 17 million.

In the face of ample evidence to demonstrate that it is more prudent for such institutions to own their office edifices, the ADB board and management have rather chosen under very questionable circumstances to pay 12 million Ghana Cedis annually working from the Accra Financial Centre (AFC) constructed by the Rand Merchant Bank (RMB) of South Africa.

The bank used to pay U.S $ 500,000 for the Citizen Kofi building situated between Danquah Circle and Labone Junction for the operations of some of the headquarters staff.

For the four other buildings rented for similar purposes: The St Kizito Catholic Church facility close to Nima Round-about; Ring Road Central (RRC) Branch and the Achimota Branch the bank pays not more than U.S $ 300.000 00.

Together with the U.S $ 500,000 for Citizen Kofi, the total rent charge for these four subsidiary headquarters operations at the current exchange rate works up to about 3.1 million Ghana cedis annually.

Adding the 300.000 Ghana cedis on maintenance of the headquarters building, ADB’s annual expenditure for its headquarters office accommodation totals about 3.4 million Ghana cedis.

However, the board and management have chosen to dispose of the headquarters building for a paltry U.S $ 17 million dollars and rather pay an annual rent for the four floors in the AFC, a building constructed on ADB’s own land which according to Mr. Kpordzie was valued at U.S $ 2.4 million.

Meanwhile, workers of ADB who are in the thick of agitations against the alleged mismanagement of the bank have reported to UNICOF, their mother union that personnel of state security apparatus have started meddling in the purely internal management issue.

In a related development the Tema District Council of Labor issued a stern warning to the management of ADB last Thursday that they would resist any attempt to sell off the bank to any foreign entity.

They maintained that ADB is a brain-child of the Tema District Council of Labour, hence they would not sit down to have the place sold out.
More soon…
Source: www.myakoben.com

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