You are here: HomeBusiness2018 03 21Article 636494

Sports News of Wednesday, 21 March 2018

Source: Myjoyonline.com

Black Stars in danger of losing uniBank sponsorship?

The Black Stars are in danger of losing their sponsorship deal with uniBank after the indigenous bank was declared insolvent by the Bank of Ghana on Tuesday.

The financial institution are the official bank sponsor for the Black Stars and also has head coach Kwesi Appiah as well as deputy captain Andre Ayew as ambassadors.

In November 2016, uniBank renewed its partnership with the Ghana Football Association by signing a three-year deal worth $1.2 million with the money going into the operations of the senior national team.

But with the current situation as the Bank of Ghana has appointed audit firm KPMG as new administrators, the deal could be abrogated.

uniBank among other things persistently maintained a capital adequacy ratio (CAR) below zero (currently negative 24%), making it technically insolvent.

It contravenes section 29 of Act 930 which requires a minimum CAR of 10% to be maintained at all times.

Also, they persistently suffered liquidity shortfalls and consistently breached its cash reserve requirement.

As a result, uniBank has relied extensively on liquidity support (over GHS 2.2 billion) from the Bank of Ghana over the past two years to meet its recurring liabilities.

Among other things, a key shareholder of the bank managed to obtain liquidity support from the Bank of Ghana using third-party banks as its agents.

The Bank of Ghana’s exposure to the bank was therefore underestimated by nearly GHS 400 million, as this amount was not reflected in its books.