BoG gives First Rand go ahead to begin operations in Ghana

First Rand Bank has received final approval from the Bank of Ghana (BoG) to start operations in the country.

The South African lender secured a provisional license last year but needed the final approval before it could open its doors to the public in Ghana.

[contextly_sidebar id=”c9oCD6W9shrIhaOtUMX4mODAGHEu8nqK”]First Rand’s Chief Executive Officer and the Regional Head of the bank for West Africa, Michael Larbi earlier told Citi Business News in an interview that they would start operations by June 2015.

“We are looking to begin operations soon in Ghana by June 2014 and we like huge projects which will give better returns for all of us.”

But can First Rand be able to penetrate the market and make some good returns on its investments.

First Rand have invested between 750million to 950million dollars in both debt and equity in Ghana.

The bank is said to be setting aside some billions of dollars for their entry into the country and other West African countries.

First Rand Bank Citi Business News gathers has already got crack personnel in place who are expected to kick start the Banks operations soon.

The bank has its head office at the plush Accra Financial Centre opposite the British Council, a huge office complex which First Rand is said to have some shares in.

However, it remains to be seen how First Rand will be able to penetrate the Banking sector and make some good returns which some analyst suggest is saturated looking at the number of banks operating in the country.

First Rand is currently financing a number of large infrastructure projects; office structures by real estate companies, and power projects like the Kpong Power Projects, and are expected to make good returns when they begin operations.

According to the Chief Executive of First Rand, Sizwe Nzasana they will be operating as a commercial bank.

In 2013 South Africa’s biggest finance groups, First Rand Bank was one of the main bank’s that expressed interest in acquiring Merchant bank now Universal Merchant Bank (UMB).

The Bank of Ghana subsequently approved the sale of Merchant Bank to private equity firm, Fortiz, after SSNIT, majority shareholder of Merchant Bank, rejected an offer from First Rand Bank.

The investment unit of First Rand (Rand Merchant Bank) had commenced operations in Nigeria also in early 2013 but the bank has now reportedly applied to the Central Bank of Nigeria (CBN) for a commercial banking license.

By: Norvan Acquah Hayford/ citifmonline.com/Ghana