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General News of Wednesday, 21 March 2018

Source: classfmonline.com

Punish uniBank directors – Professor Quartey

Professor Peter Quartey, Head of Economics Department at the University of Ghana, has said the directors of uniBank must be punished for their actions that led to the Bank of Ghana (BoG) taking over the management of the indigenous bank.

The central bank in a statement released on Tuesday, 20 March, said uniBank refused to cooperate with it in the performance of its supervisory responsibilities, including deliberately concealing some liabilities from its balance sheet, and failing to submit documents and records for supervisory inspection, hence the takeover.

The bank, among other things, also “failed to comply with a directive of the Bank of Ghana dated 26th October, 2017 under section 105 of Act 930, prohibiting the bank from granting new loans and incurring new capital expenditures. Failed to comply with several other regulatory requirements, including: Lending to a number of borrowers in excess of its regulatory lending limit (single obligor limit) under section 62 of the Banks and SDIs Act, 2016 (Act 930).”

Speaking on this development on Ghana Yensom on Accra100.5FM hosted by Chief Jerry Forson on Wednesday, 21 March, Prof Quartey said: “I wasn’t happy with the bank failing to comply with the directive given by the BoG. You don’t give new loans whereas you haven’t been able to recover the loans you have given out.

“One thing we should all understand is that in banking you are taking somebody’s money and lending it to another, and, so, you are working with people’s deposits, therefore, your interest will be to recover the loans you have given out so you will be able to pay the depositors if they need their moneys at any time.

“But they went ahead to give loans at the time the BoG has given them a directive, and, so, as the regulator, the BoG has to crack the whip and that is what has happened.”

Specifically on the claim that the bank concealed some liabilities from its balance sheet, and failed to submit documents and records for supervisory inspection, as indicated by the central bank, Prof Quartey said: “I am quite surprised the bank did that because uniBank is a respected bank and has respected people behind it. Those managing the day-to-day affairs of the bank who did that must be punished. If it is true they actually concealed some liabilities from their balance sheet then they must be punished because that action is criminal.”