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19.07.2018 Business & Finance

BELSTAR Fights Back In Murky UniBank Affair

By CitiNewsRoom
BELSTAR Fights Back In Murky UniBank Affair
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BELSTAR Capital Limited has rejected claims that it used Bank of Ghana's money from uniBank in buying shares in adb bank.

The Central Bank on Monday annulled the acquisition of shares in adb Bank held by four investors – Belstar capital, Starmount Development Company Limited, SIC Financial Services and EDC Investments Limited.

Bank of Ghana accused Belstar and Starmount of acquiring ADB's shares in 2016 “with funds obtained from uniBank Ghana Limited (currently in official administration) using emergency liquidity support obtained by uniBank Ghana Limited from the Bank of Ghana in questionable circumstances.”

The four investors combined owned 51 percent of ADB, which was listed on the Ghana Stock Exchange (GSE) in December 2016.

BoG also insisted that “the liquidity funds obtained by uniBank were improperly and unlawfully on-lent to Belstar and Starmount to acquire shares (including shares held by the Financial Investment Trust on behalf of the Bank of Ghana) in ADB's IPO,” hence its action.

But Belstar in a statement signed by its chairman said the BoG's claims against it are untrue.

BELSTAR argued that at the time the IPO was being bought, the amount of fund available to uniBank exceeded the amount of money it (uniBank) loaned to BELSTAR .

“Whilst information available to BELSTAR confirms owing to a default in loan repayments to uniBank by key government related entities, the bank had sought emergency liquidity support from BoG. The quantum of depositor’s funds available to uniBank at the time of the IPO far exceeded the amount of money loaned to BELSTAR to acquire the shares in ADB.”

“As borrowers, BELSTAR will not know the source of the money offered, but given what we know to be the state of affairs of the IPO, uniBank or any bank would rather lend the cheaper depositors fund of which they held 3 billion cedis as opposed to the emergency liquidity support of nearly 800 million cedis. We believe that the BoG statement is incorrect and regrettable,” the statement from BELSTAR added.

Status of uniBank
Unibank is currently being run by private audit firm KPMG Ghana following a directive by the Bank of Ghana.

This was after the BoG announced it has taken over the bank to prevent it from collapsing.

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