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Business News of Tuesday, 21 August 2018

Source: Myjoyonline.com

BoG should have alerted Board about uniBank troubles - Former Board member

The Bank of Ghana has been faulted for disrespecting shareholders when it announced the dissolution of uniBank, a former board member has criticized.

Professor Newman Kusi said shareholders should have been given the opportunity to save the bank after the central bank found it had become insolvent.

The bank's shareholders could have bought additional shares as a way of recapitalising the bank but were denied this option.

According to him, the dissolution of the indigenous bank amounts to an expropriation of private assets.

But speaking on Joy FM's Super Morning Show, Prof. Kusi said he was hurt by the failure of the central bank to inform the shareholders before going public with the August 1 announcement to revoke the bank's licence.

Despite pumping over 2billion cedis to help uniBank, the central bank said in March 2018 it had appointed an official administrator for the struggling bank.

The former board member said within five months the Bank of Ghana had made four visits to uniBank for routine banking supervision in 2017.

This concerned the Board because such visits were usually carried out once a year, he said. Prof. Kusi said the Board which meets every three months wrote to the central bank in January 2018 to explain issues it had with the bank.

"Even if you have problems with management, we the Board can step in to help deal with the issue", he said.

But the regulator ignored their inquiry and on March 20, 2018 and announced it had appointed an official administrator, KPMG.

KPMG has produced a report on uniBank's operations detailing serious breaches and violations it admits are unverified.

BoG had said in March 2018, uniBank did not report their loan banks accurately hence the need for downgrading the bank and making further visits.

But Prof Newman Kusi said this is one of several issues which the central bank should have brought to the notice of the board or shareholders.

"If you really wanted the problems resolved why didn't you give the bank an opportunity?", he queried.

The former Board member said the Board which operated under the blessing of the central bank also had a role to play in resolving any financial difficulties.

Prof. Kusi has indicated the former Board members will challenge the central bank's decision to revoke the licence of uniBank.

He expressed disappointment in the central bank for failing to provide shareholders and board members with a copy of the KPMG which has been circulating in the media.