{"id":411610,"date":"2018-03-21T17:00:00","date_gmt":"2018-03-21T17:00:00","guid":{"rendered":"http:\/\/citifmonline.com\/?p=411610"},"modified":"2018-03-22T06:44:55","modified_gmt":"2018-03-22T06:44:55","slug":"well-save-unibank-first-probe-management-later-bog","status":"publish","type":"post","link":"https:\/\/citifmonline.com\/2018\/03\/well-save-unibank-first-probe-management-later-bog\/","title":{"rendered":"We’ll save uniBank first, probe management later – BoG"},"content":{"rendered":"
The Bank of Ghana (BoG)\u00a0has said establishing wrongdoing on the part of the hierarchy of uniBank is not its key focus, after the Central Bank took over management of the indigenous financial institution.<\/p>\n
The BoG’s\u00a02nd Deputy Governor of the Bank of Ghana, Elsie Awadzi said the takeover of uniBank is primarily to keep it from collapse.<\/p>\n
[contextly_sidebar id=”vWiOA3Ng58tMntECjJAXCXIcfPZ7eNDh”]”We do have information as to violations of the regulatory framework and what we think was done and not done. The purpose of putting an official administrator in place is to get hold of irrefutable evidence that allows us to move forward. It is not the entire objective. The key objective is to save the bank and to turn it around to be a stronger and a better bank,”\u00a0Elsie Awadzi stated on the Citi Breakfast Show.<\/strong><\/p>\n She said once the bank’s situation had been stabilised, pursuing\u00a0possible wrongdoing was still on the table “for the sake of the public trust that is reposed in banks and for the sake of depositors.”<\/p>\n She explained further that information gathered during the takeover will also be key to addressing the failings of the bank’s management.<\/p>\n \u201cOn the basis of any such information that we obtain, we will see what the options are for addressing and correcting what has happened in the past. We will involve any other authorities that need to be involved to take up the matter.”<\/p>\n Status of UT Bank and Capital Bank probe<\/strong><\/p>\n Elsie Awadzie also gave a similar explanation for the probe into whether the activities of the top officials of UT Bank and Capital Bank led to the collapse of the two financial institutions in August 2017.<\/p>\n UT Bank and Capital Bank were unable to\u00a0turn around their negative capital adequacy position, which necessitated a\u00a0Purchase and Assumption agreement allowing GCB Bank to take over all their deposit liabilities and selected assets.<\/p>\n According to her, once the takeover of the two banks was confirmed, the BoG immediately began working towards ensuring that the assets of the banks were secure.<\/p>\n \u201cIn the case of UT Bank and Capital Bank we were winding up those banks and the first order of business was to immediately lay hands on assets to be able to recover value and take them back,\u201d she said.<\/p>\n She added that the management of BoG has proceeded to investigate the top management of the banks and would finalize the reports in due time.<\/p>\n Review of supervisory framework<\/strong><\/p>\n The BoG revealed that uniBank had failed to comply with a directive from the BoG to stop granting new loans whilst also and deliberately concealing some liabilities from its balance sheet.<\/p>\n uniBank also failed to comply with several other regulatory requirements, including lending to a number of borrowers in excess of its regulatory lending limit.<\/p>\n Before all this, uniBank was one of nine banks identified after the asset quality review exercise undertaken in 2016, to be significantly undercapitalized with a capital asset ratio of 4.75%.<\/p>\n The state of uniBank ahead of its takeover called into question the monitoring capabilities of the BoG.<\/p>\n Elsie Awadzi responded to this by saying the BoG was going to review its supervisory framework.<\/p>\n \u201cWe as new management of the Bank of Ghana are taking steps to review our entire supervisory and lending framework and liquidity support framework. We are taking steps to make sure the system is not\u00a0exploited and that it is a framework that is resilient, that it is a framework that has integrity and that it is a framework that is not abused by the market.\u201d<\/p>\n