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Business News of Wednesday, 22 August 2018

Source: Myjoyonline.com

uniBank fightback will make BoG sing in court - Lawyer

A legal practitioner says a shareholder of the defunct uniBank, Dr Kwabena Duffuor's suit challenging the revocation of its license faces bleak prospects.

Dr Eric Oduro Osae pointed out that for the court to reverse the action of the regulator, the plaintiff and major shareholder Dr. Kwabena Duffuor would have to prove the damage done him is irreparable.

The shareholders have argued the government owes the bank some 868million cedis which if paid would have solved the liquidity problems which was cited for withdrawal of the licences.

The former shareholders also maintain they were prepared to inject more money to support the bank that has had to fall on the Bank of Ghana for more than 2.2bn liquidity injection.

These arguments in the statement of claim is beside the point, Dr. Oduro Osae suggested. For him, the focus is whether there was wanton breaches of corporate governance structures of uniBank.

The lawyer said the suit is an opportunity for the Bank of Ghana to finally 'tell the whole story' behind the collapse of the indigenous bank.

So far the regulator has been using press conferences to announce licence withdrawal and press statements to explain their actions.

But that could all change when the central bank's officials mount the docket and slug it out with former shareholders of uniBank.

The High Court will be a cinema, premiering a live and expectedly lively encounter between uniBank and the central bank.

In August 2018, uniBank, The Beige Bank, Royal, Construction and Sovereign banks were rolled into a megabank, Consolidated Bank of Ghana.

CBG was newly created and bankrolled by the government to manage assets and liabilities of the affected banks. A victory for uniBank could see the defunct bank "deconsolidated" from the Consolidated Bank of Ghana, the lawyer said.

He said a victory will also open the floodgates for other affected banks to sue for a return of their banks and leave the central bank with dented credibility.