Finance Minister Ken Ofori Atta has hinted that the five local banks to be recapitalised under the Ghana Amalgamated Trust (GAT) will be asked, as part of strategies considered to ensure the GHC2 billion being invested in them is secured, to list on the Ghana Stock exchange.
This was contained in a document presented by the Finance Minister to Parliament for the house to approve government's request for a sovereign guarantee to raise GHC2b to recapitalise the five local banks.
The five local banks include ADB, UMB, Prudential NIB and OmniBSIC.
The document presented by the Finance Ministry also stated that the five local banks will be encouraged to merge as part of the outlined strategies being considered to make sure the funds invested in the banks are secured and can be monitored.
Under GAT, shareholders of the local banks will sign some commitment that will see managers of the trust have managerial and board control of these banks as well as credit issues and promote strict corporate governance practices.
Recapitalizing the five local banks is expected to be completed by the end of March after it raises all the GH¢2 billion from investors for its five-year corporate bond.
GAT would also be paying an interest of 21 per cent per annum because it’s a “zero-rated bond” but rather the principal plus the interest would be paid at the end of five years. The bond would be raised in two tranches; the first would be GH¢750 million and another GH¢1.5 billion.
Minority on GAT
The Minority in Parliament has said they will reject the GH¢2billion loan meant to rescue some local banks under the Ghana Amalgamated Trust (GAT) Limited. Deputy Minority Leader James Klutse Avedzi said GAT is an illegal entity and the Minority will reject the approval of sovereign guarantee for the loan.
“We don’t know what is GAT. Ghana Amalgamated Trust Limited, is it a company? Established by who? Parliament knows nothing like that. So, why do you introduce a company that is alien to Parliament for Parliament to work for us to give a sovereign guarantee for that company to go and borrow?” he asked.
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