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Business News of Monday, 28 January 2019

Source: Myjoyonline.com

CDH Savings and Loans worried over locked up funds with CBG

CDH Savings and Loans has expressed worry over locked up funds with Consolidated Bank of Ghana (CBG).

These looked-up funds are said to be the main reason why there have been delayed payment of customers’ funds by most savings and loans companies.

The banking sector clean-up saw licenses of seven banks revoked by the Bank of Ghana and the Consolidated Bank of Ghana (CBG) was formed.

Speaking to JoyBusiness, Executive Director of CDH Savings and Loans, Martin Asamoah said, “To tell you there’s not been a liquidity challenge in the financial sector will be a lie. Following the takeover of Capital and UT banks in 2017, there were panic withdrawals which had a little effect on us. With some of our funds locked up at the Consolidated Bank, there have been steps to retrieve them and we are hopeful this will be sorted out very soon.”

Defunct Capital Bank legal suit against CDH Savings and Loans

Mr Asamoah had earlier expressed utmost surprise at the suit by the receiver of the defunct Capital bank.

He noted that the CDH legal team and that of the receiver had several meetings ever since the crises started.

“We have funds of the capital bank and they also have funds with us, because we are trading together and have been cooperating ever since the crises started’ he stated. When the receiver wrote to us, we even initially put in our claims of how much we have with the capital bank, we met the lawyer of the receiver and had intensive discussions,” Mr Asamoah added.

He said the two parties agreed to the figures and that a careful look at the figures indicates that the defunct capital bank even owed CDH. “If I show you the mail from the lawyer, the net figure per our agreement in February 2018 was supposed to be GH?55 million. They are suing us for GH?100 million and I’m wondering how it got there,” Mr Asamoah lamented.

Panic withdrawals in Savings and Loans Companies

Some savings and loans companies in the country have been hit by panic withdrawals.

The development has already made it difficult for these companies to meet customer demands.

According to some of the companies, the situation has been compounded by the fact that most of their clients are not paying back their loans on time.

The Executive Secretary of the Association of Savings and Loans Companies, Tweneboah Kodua Boakye, for instance, has maintained that the situation is very bad and it is putting a lot of pressure on their operations.

He said, “When you talk to some of these depositors, they would just tell you, we really don’t need the money, but are just not sure about your future hence the withdrawals.”

He added that depositors should understand that everything is safe and the reforms being undertaking by the Bank of Ghana would ensure that the entire system is safe.