The Bank of Ghana has revealed that shareholders of Unibank took GH¢5.3 billion from the bank without going through the proper procedures.
This constituted a 75 percent of total assets of the bank.
According to the central bank, Shareholders, related and connected parties had taken amounts totaling GH¢3.7 billion which were neither granted through the normal credit delivery process nor reported as part of the bank’s loan portfolio.
In addition, amounts totaling GH¢1.6 billion had been granted to shareholders, related and connected parties in the form of loans and advances without due process and in breach of relevant provisions of Act 930.
Due to this development, The Official Administrator appointed for uniBank in March 2018 said that the bank was beyond rehabilitation.
UniBank together with Royal Bank were identified during the Asset Quality Review update in 2016 exercise to be significantly undercapitalized.
The two banks subsequently submitted capital restoration plans to the Bank of Ghana.
These plans however, yielded no success in returning the banks to solvency and compliance with prudential requirements.
The BoG has subsequently merged Unibank together with four other banks namely Beige bank, Construction bank, Royal bank, Unibank and Sovereign Bank.
The five banks together are thus called the Consolidated Bank Ghana limited.
Shareholders of uniBank to recapitalize
Shareholders of Unibank in July resolved to recapitalize the bank to address both the solvency and liquidity challenges facing the institution.
The decision according to sources was taken by Dr. Kwabena Duffuor, a shareholder of the bank on behalf of shareholders of the bank.
The assessment was made after the official administrator of the bank, KPMG, wrote a letter to the shareholders of the bank urging them to accept one of three strategic options to save the bank.
The options included “Good banks or Bad banks, Recapitalization by existing shareholders with or without new shareholders and Recapitalization by new shareholders”.
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By: Jessica Ayorkor Aryee/citibusinessnews.com/Ghana