About six international firms have expressed interest in acquiring a stake in Agriculture Development Bank (adb) amid plans to float the bank’s Initial Public Offer (IPO) on the Ghana Stock Exchange later this year.

The firms including the International Finance Corporation, Actis Capital, CDC Capital Group, Atlas Mara Limited, Africa Capital Alliance and one other have already completed due diligence into adb.

The Managing Director of adb, Stephen Kpordzih who disclosed this in Accra last week said: “After stakeholder consultations, we have also done due diligences -- legal and financial -- and the anchor investors who have expressed interest in investing in the bank have also come to do their due diligence”.

The comments of the head of Ghana’s foremost agric financing institutions come after widespread allegations that shareholders of adb -- Government of Ghana and the Bank of Ghana -- have begun processes to ‘secretly’ offload part of their stake in the bank, with FirstRand Bank of South Africa allegedly cited as the beneficiary.

But Mr. Kpordzih dismissed the claims, as the bank is nowhere close to releasing its shares onto the market, saying: “At this point, no shares have been issued to any company anywhere. We are a long way from that process, and so if anyone hears that there’s secrecy about the transaction, there is no secrecy at all. I have given you the facts as they are”.

A representative of IC Securities -- transaction adviser to adb on the IPO listing -- Kwabena Osei Boateng said the listing processes are miles away

“We have received approval from SEC, and since then we also spent a lot of time engaging the Ghana Stock Exchange on the transaction. Since the approval, the 2014 audit has now been completed, so we are taking an opportunity to have a look at the valuation to see whether or not there will be some impact.

“In addition, we are spending a lot of time on developing a marketing strategy and plan. One of the key objectives of the IPO is to make sure there is significant Ghanaian participation, so we want to ensure that the marketing strategy is such that all Ghanaians know about the IPO and some of the key terms of the IPO as approved by SEC; and that they have time and opportunity to subscribe when it becomes available.

“We are also spending time with management on an employee share-option scheme to enable employees of adb to own a stake in the bank. So we are spending time looking at the valuation, marketing strategy and plan, and spending time on the employee share-option scheme. Once they are completed, we will revise the offer document and go back to SEC. We will be seeking further approval to then commence the offer; so that’s where we are with the transaction,” he said.

adb, which is one of the top-five banks in the country, plans to float the Bank of Ghana’s shares and part of government’s stake on the Ghana Stock Exchange to raise GH?200million to fund growth.

The Ministry of Finance holds 52 percent of the bank, with the rest held by the BoG through a trustee. The central bank has often been criticised for owning part of an entity it regulates -- a situation that critics, among them the International Monetary Fund, say creates a conflict of interest and fuels perceptions of favouritism.

Mr. Kpordzih admittedly said the capital expected to be raised in the offer proposal is insufficient to the bank achieve the level of growth that it anticipates adding: “But it will be a good starting point for the bank that it will give us access to other lines of credit. Listing on the stock Exchange will also bring good corporate governance practice, transparency and accountability.”

It is expected that listing adb will deepen the market and widen the options for investors.

adb is the eighth-largest bank in Ghana by assets and the second-biggest of the three banks -- including GCB and National Investment Bank -- in which the state has a significant stake.

The bank is the ninth-largest by size of loans in an industry of 27 banks. In 2013, its loan book expanded by 11 percent to GH¢0.9billion and the bank registered pre-tax earnings of GH¢84million. The equity in the bank stood at GH¢281million in 2013.

adb prides itself on being a bank dedicated to financing agriculture, but concerns have been raised about whether its current structure and operations give the needed thrust to the agricultural sector -- with many commentators asking for the bank to be repositioned to upscale its agriculture business.

Ghana’s agricultural sector employs approximately 42 percent of the working population, according to census data. The sector is often said to be growing below potential, with farmers facing perennial problems such as unavailability of modern equipment, erratic rainfall, and expensive credit.

Currently, adb is in the initial stage of its follow-up strategic plan for the 2014-2016 period -- which is designed to ensure the bank’s sustainable growth and profitability and build on the key successes achieved in the previous strategic plan that was completed in 2012.