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Business News of Wednesday, 27 May 2015

Source: GNA

Adb IPO will benefit Ghana – GFL

Ghana Federation of Labour (GFL) on Tuesday welcomed the adb Bank Limited’s intended Initial Public Offering (IPO).

It said the move would be of benefit to the operations of the bank and the country as a whole.

“We are in support of the share floatation because this would generate the needed capital to overhaul the operations of the bank to make it profitable and more relevant in the financial sphere,” Abraham Koomson, Secretary-General of the GFL told the media in Accra after a meeting with the management of the adb.

The adb management has been consulting widely with stakeholders on the bank’s intention to list on the stock exchange.

The Farmers and Fishermen Award Winners Association of Ghana and the Ghana Union of Traders Association have all been engaged in the endeavour.

Those consultations are geared towards sensitising stakeholders on the outlook of the bank and to seek their support for the IPO.

The bank is expecting to raise GH? 300million to recapitalise and improve its operations to keep the institution in tune with current banking trends.

Mr Koomson said many state assets were lost because they were not profitable, saying “we cannot afford to lose this one too”.

“The adb’s move to list on the stock exchange is the way to go…we support the move. I commend the management of the bank, what they are doing is in the interest of both the bank and the country.”

“We urge all stakeholders to support this move because antecedents have shown that it is more beneficial to raise money on the market to revitalise the operations of the bank than to divest it,” he added.

In an address to the executives of the GFL on the bank’s preparedness to list on the Ghana Stock Exchange, Mr Stephen Kporzdi, Managing Director of the adb, explained that with the current ownership structure as a state-owned, the bank is unable to access medium and long-term funds from financial institutions like the IFC, CDC among others.

He urged the members to support the IPO, as this would ensure that the bank becomes an effective financial institution capable of growing business.

Currently, the Bank of Ghana (BoG) owns 48 per cent of the adb Bank, with the rest being owned by the government.

BoG is offsetting all its shares, because it cannot be a regulator and an operator at the same time. Government also seeks to whittle down its shares in the institution.