CAL Bank Moves On
The tussle that started immediately after the Annual General Meeting (AGM) of CAL Bank on March 27, 2008 was to a greater extent resolved yesterday when shareholders of the bank exercised their rights at an Extra-ordinary General Meeting (EGM) called by the second largest shareholder, Afare Apeadu Donkor.
Though there were some hot exchanges in the beginning, the investors, by a simple majority, finally voted against the removal of Frank Adu Junior as Managing Director of the bank as the requisition demanded, while Mr Donkor, Ghana's Ambassador to China, was also voted onto the board by a similar procedure.
This was after the board had amended the resolution of electing three members onto the board to two after Mr. Adu Jnr had been retained as M.D, culminating in Yoofi Grant's removal, thus allowing Dr. Kobina Quansah, former M.D of Barclays Bank Ghana and Mr. Donkor for the two positions.
However, a proxy for the Social Security and National Insurance Trust (SSNIT), Maxwell Addo called for a poll voting of the two, which was accepted.
Before Mr. Donkor was chosen by the shareholders, Dr. Quansah whose election was part of the requisition had been voted onto the board. Both nominations are subject to the Central Bank's approval.
However, the proposal that Archibald Amponsah Tannor be made a board member was rejected by shareholders since that decision according to the shareholders was not communicated to them.
Nevertheless, the issue of increasing the stated capital of the bank to GH¢100 million in various tranches by 2012 was approved long ago by the board, thus preventing shareholders from voting for or against the motion.
At the said meeting in March this year, shareholders of the bank including the largest ones such as Social Security and National Insurance Trust (SSNIT)-26.63 percent, Mr Donkor-11.05 percent and Daniel Ofori-7.70 percent rejected all the three major resolutions including a creation of a pool of shares of up to 3 percent of issued shares as at December 31, 2009 for directors, which amounted to GH¢6 million, which the bank was seeking to pass.
Some of the shareholders who backed Frank Adu's retention as MD of the bank disclosed that his tenure has seen impressive growth hence their support for him.
“I invested money because I am a businessman. Thus I cannot vote against Mr. Adu Jnr since he won several awards for the bank in the recent banking awards,” Joseph Abeka Biney stated.
Another shareholder, Frank Otchere said, “I think every shareholder has his or her rights like Mr. Adu and Mr. Donkor, but I don't see anything wrong with Mr. Adu Jnr being the Chairman of the Council of the Ghana Stock Exchange and at the same time M.D of a bank.”
However, John Asafu-Adjaye, an Attorney and a proxy voter said he was disappointed by the decision of shareholders not to remove Mr. Adu Jnr.
“This is a question of good corporate governance, not results,” he said. “After all, every bank makes profits, but profits shouldn't be what decide the director of the board.”
He added that the shareholders did not like the idea of changing a profit-making team.
On Mr. Donkor's appointment, David Dzanie said he should have been on the board long ago since he is the largest individual shareholder.
Adu Anane Antwi, a chartered accountant explained that Mr. Donkor should be voted onto the board by virtue of his skills and experience.
Commenting on this historic event, Mr. Donkor explained to CITY & BUSINESS GUIDE that he was ready to work with Mr. Adu Jnr and thus there was not going to be any friction.
“I have to abide by the principles that govern management and will deliver since the shareholders voted me for that. I am satisfied with proceedings”.
On his part, Mr. Adu told CITY & BUSINESS GUIDE he was not going to comment on the event till the polling results were ready.
Yoofi Grant, an Executive Director of Databank Financial Services Limited noted that the results were good for corporate governance since shareholders rights have been respected.
“I am not a shareholder but I support the decisions”.
By Charles Nixon Yeboah & Rebecca Putterman