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19.11.2019 Business & Finance

Gov't Scheming To Collapse NIB – MP

By News Desk
Gov't Scheming To Collapse NIB – MP
NOV 19, 2019 BUSINESS & FINANCE

The Bolgatanga Central Member of Parliament (MP), Isaac Adongo, is accusing the Akufo-Addo government of deliberately scheming to collapse the National Investment Bank (NIB).

He says, the government in recapitalizing the bank, pumped assets into it and exposed it to imminent collapse.

In the past, the legislator has accused the government of selling off the national asset and opposed moves to support it under the Ghana Amalgamated Trust (GAT) support package for solvent but under-capitalized banks.

Speaking on the Floor of Parliament on Monday, Mr. Adongo who is also a member of the Finance Committee, described the development as dubious.

“NIB is on its way to death and is essential because it is a calculated attempt to bring it this way. The Minister tells us that he didn’t have money when he was asked to re-capitalise NIB. He rather decided to take the most important thing on the balance sheet of NIB which is the net-share of 24 per cent. Everybody knows that the problem of NIB is because it has not recapitalised and depositors are taking their monies from them. They have been given a loan of GHS 500 million so that depositors can take their money so NIB will collapse. How can they do that to NIB?”

“If they had allowed the shares to be sold and an announcement made that those shares would be sold to recapitalise NIB, there will have been confidence in NIB and the market would have come down and at the end of the day, NIB will have been saved. The main idea is to collapse NIB.”

Recapitalization under GAT

Five banks were categorized as well run but undercapitalized banks in the sector clean-up which gave them access to GHS 2 billion in funds to shore up their minimum capital requirement.

The five banks are: ADB, NIB, merged Omni/Bank Sahel Sahara, Universal Merchant Bank, and Prudential Bank.

The Ghana Amalgamated Trust, which is made up of some private pension funds in the country, is envisioned as support for five banks that could not meet the GHc400 million capital requirement but were solvent.

Government stressed that the banks in the arrangement must not consider the support they are receiving as a bailout programme.

Already, the move to use the pension funds has received some criticism from unions and observers.

---citinewsroom

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