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13 August 2017 | Headlines

Seek approval before going for loans – Nana Addo to universities

Seek approval before going for loans – Nana Addo to universities

President Nana Akufo-Addo has urged public universities to seek approval from the Finance Ministry and the Attorney General before getting any loan facilities.

Akufo-Addo said this at the graduation ceremony of some medical doctors at the University of Cape Coast on Saturday.

The directive comes after a long drawn dispute between the University of Ghana and some players in the banking sector over some loans that were contracted to undertake projects at the university.

“I think we should learn from previous and unfortunate bitter experience that such arrangement should not be done on the blind side of the government. I will strongly urge if you have not already done so, that you seek the blessing of the Ministry of Finance and the office of the Attorney General to the arrangement,” Nana Addo stated.

“There is currently a difficult situation at the University of Ghana that should serve as a useful lesson for all public tertiary institutions which seek to engage in such arrangements.”

CAL Bank hauled the University of Ghana to court in 2015 over the non-payment of some money owed the bank.

According to the bank at the time, the decision was due to the delay in the repayment of the loan facility that the bank granted the institution towards the provision of about 7000 bed capacity hostel facilities.

At the time, the MD of the bank had said that government was not committed to the repayment process.

“We did have significant real estate exposure three years back and three years on we still have some exposure. The significant portion of it is being paid or it is still current, but we still have a situation with UGEL, the hostels the situation there is that the hostel is occupied and the students pay the residential user fees but the University does not service the facility.”

“There have been several meetings on it and government has decided to take over and settle the six banks involved, we haven't seen the government, seen the steps as expected in settling that debt so we have taken the decision to go to court so very soon CAL bank will own 12,500 beds,” he said.

By: Jeffrey Owuraku Sarpong/
Follow @ojsarpong

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