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Business News of Tuesday, 6 November 2018


CDH Holdings sued over GHc109m owed defunct Capital Bank

The collapsed Capital Bank has sued CDH Financial Holding and CDH Savings and Loans to recover over GHc100 million owed it.

Receivers of Capital Bank want the High Court to order the payments of GHc109.4 million plus the accrued interest.

In addition, it is urging the court to order the Bank of Ghana to withdraw the licenses of CDH Financial Holding and CDH Savings and Loans for their inability to pay back investment on maturity dates.
Reports indicate that Capital Bank is blaming its collapse partially on the purported indebtedness of the two CDH firms.

But responding to these reports on Eyewitness News, the Managing Director of CDH Investment Holdings, Emmanuel Adu-Sarkodie, said “the accusation is absolutely false… it may be an example of what you call fake news.”

“When we meet in court next week, they would have to show the court where they came up with such a number,” he added.

He also said only CDH Financial Holdings owed Capital Bank.

“CDH savings and loans does not owe Capital Bank any money. It is Capital Bank that owes CDH Savings and Loans… Then you have CDH Financial Holdings, which owes money to Capital Bank.”

Mr. Adu-Sarkodie said his firm has been in meetings with the receiver of Capital Bank where it was acknowledged that CDH Savings and Loans were owed.

It was also established that money that CDH Financial Holdings owed would be settled but was in accounts with Premium Bank

“We told them that the money was not with us. The money was actually with Premium Bank, which was to the tune of GHc92 million.

He added that the Receiver’s lawyers were in a meeting where it was agreed that “Premium Bank was going to pay the money and the money was going to come soon.”

The defunct Capital Bank was owed “between the range of GHc55 to GHc56 million” by CDH Financial Holdings, but owes CDH Savings and Loans about GHc 26 million, as at August 2017, according to Mr. Adu-Sarkodie.

Other lawsuits

An offshoot of defunct UT Bank— UT Holdings and UT Logistics, has also been sued by receivers of the bank, PricewaterhouseCoopers (PwC) for non-payment of some loans acquired before the collapse of the bank.

According to the suit an amount of GHc51 million and US$8 million respectively, were invested into UT holdings before UT bank collapsed.

Likewise, PwC in its writ also complained that UT Logistics has refused to pay a GHc9 million loan balancer “which remains outstanding and unpaid till date.”

PwC is, therefore, asking the court to order both companies to refund the money with the necessary interest.

UT Bank is among seven local banks that have collapsed in the country in the last 12 months, after becoming highly insolvent.

UT Bank and Capital bank were the first companies that collapsed and were taken over by the GCB bank in 2017 after receiving the green light from the central bank, the Bank of Ghana.

ICGC, Otabil not spared

15 shareholders including, Pastor Mensa Otabil and his church, the International Central Gospel Church (ICGC), have been sued over the collapse of Capital Bank.

The suit was brought against the shareholders by Vish Ashiagbor and Eric Nana Nipah of PricewaterhouseCoopers who are receivers of the bank.

In their writ of summons, the plaintiffs indicated that within seven years, the directors of the defunct bank approved loans and placement of funds to themselves and related parties “without the requisite collaterals and in clear breach of the company’s internal policies and relevant banking regulations and Ghanaian company law.”

Outlining the failure of the each of the 15 persons sued, the plaintiffs are praying the court to order the defunct bank’s directors to pay compensatory damages to the receivers.

It also wants the bank’s former founder, William Ato Essien to pay back over GHS 468 million in shareholder loans and some GHS 108 million that was granted to him and his other companies.