Unibank, others’ merger deliberate to collapse local banks – Adongo

Unibank, others’ merger deliberate to collapse local banks – Adongo

- NDC MP says Bank of Ghana’s merger of five local banks is deliberate to collapse huge local banks

- The Central Bank on August 1 merged Unibank, The Royal Bank, Sovereign Bank, The Construction Bank and Beige Bank under a new name Consolidated Bank of Ghana Limited

Member of Parliament for Bolgatanga Central, Isaac Adongo, has accused the Bank of Ghana (BoG) of deliberately collapsing local banks following the merger of five banks.

On Wednesday, the Central Bank announced that The Royal Bank, Sovereign Bank, The Construction Bank and Beige Bank have been merged to form The Consolidated Bank of Ghana Limited.

The BoG explained that the five banks were merged in order to “ensure that the banking sector maintains a strong indigenous presence”.

Unibank, others’ merger deliberate to collapse local banks – Adongo

Bolgatanga Central MP Isaac Adongo. Source: JoyNews

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However, Mr. Adongo believes contrary to the reason given, the Central Bank is rather deliberately collapsing local banks.

According to him, the decision to merge the aforementioned banks is one that will definitely bring “industry players on their knees”.

You have KPMG write a letter that indicates that there is a hole of GH¢5.7billion in Unibank alone. The governor of the Central Bank announces that the government has issued a bond of GH¢5.6billion,” the lawmaker told Accra-based Starr FM.

He added: “What it means is that that GH¢5.6billion is not even enough to cater to Unibank. So, what is the hole in Beige bank? What is the hole in Construction Bank? What’s the hole in The Royal Bank? So cumulatively, what’s the deficit we are looking at? So, what are you merging? Empty bank, with serious liquidity gap without any funding?

“So clearly…this is an administration in disguise announcing the fiscal cost of dissolving these banks in other to manage expectations of players in the industry. And I want to tell you emphatically, a culmination of regulatory collaboration to bring bigger industry players on their knees.”

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Meanwhile, the Governor of the Bank of Ghana, Ernest Addison, has explained that the newly established Consolidated Bank “will act as a bridge bank pursuant to section 127 (11) of Act 930, to assume some of the assets and liabilities of the five banks”.

According to him, “the Government has capitalised the new bank in the amount of GH¢450 million and the Bank of Ghana has issued it with a universal banking licence with effect from 1st August 2018.”

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Source: Yen.com.gh

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