Collapse Of Banks: UT, Capital banks collapse cost Ghana GH¢3.4bn - Isaac Adongo

Speaking at a public lecture in Accra organised by a pro-NDC group, Coalition for Restoration (CRF), Mr Adongo said that the collapse of the two banks has so far cost the country GH¢3.4 billion.

The Member of Parliament (MP) for Bolgatanga Central, Mr Isaac Adongo, has expressed worry as to why the government and the Bank of Ghana (BoG) have remained silent on the financial impact of the collapse of UT and Capital banks on the taxpayer.

Speaking at a public lecture in Accra organised by a pro-NDC group, Coalition for Restoration (CRF), Mr Adongo said that the collapse of the two banks has so far cost the country GH¢3.4 billion.

 

He said that out of that amount, GH¢1.4 billion was used as liquidity support for the failed banks in 2016 prior to their collapse in August, this year, while “the government now intends to issue a bond of GH¢2 billion to pay the GCB Bank for the difference in the valuation of the selected assets and liabilities taken over.”

“This GH¢3.4 billion is to be borne by the taxpayer and it is three times the budget of the Free SHS programme for the first year. Yet neither the Minister of Finance nor the BoG Governor is telling us about it,” Mr Adongo added.

READ ALSO: Former CEO predicted the collapse of Capital Bank in 2014

The Bank of Ghana withdrew the licences of the two banks on Monday (August 14, 2017) and GCB Bank subsequently took over transfers of all their deposits and selected assets after a purchase agreement.

Mr Adongo said even though the government and the BoG Governor, Dr Ernest Addison, mentioned non-conformity to good corporate governance and recklessness by management and board of directors as the cause of the collapse, it is unfortunate that they are yet to reveal the cost of the collapse of the two on the taxpayer.

“When the governor met his colleagues at the Chartered Institute of Bankers at a dinner, he failed to tell them how much the taxpayer is paying to clean up the mess of those who collapsed the banks.”

READ ALSO: Mass withdrawals hit UT, Capital ... - Pulse.com.gh

“The taxpayer has already paid GH¢1.4 billion to clean up the mess of the directors and there is a further GH¢2 billion that has been set aside in the 2018 budget to clean up the mess this year. In total, it is costing us GH¢3.4 billion to clean up this mess,” he said.

He believed that the figure could have been used to finance the education of children in the country.

Speaking at a public lecture in Accra organised by a pro-NDC group, Coalition for Restoration (CRF), Mr Adongo said that the collapse of the two banks has so far cost the country GH¢3.4 billion. Read Full Story