11 October 2018

Ghana: Ghȼ 400 Million Retrieved From Loan Defaulters of Defunct UT, Capital Banks

The Joint Receivers for loans of the defunct UT Bank and Capital Bank has said it will soon publish names of loan defaulters with their corresponding amounts owed in the media.

The Joint Receivers said in a statement signed by Mr Eric Nipah, Joint Receiver and issued in Accra yesterday that they had been vigorously pursuing debtors through negotiations and court actions in order to recover substantial amounts owed both banks as it was critical to paying creditors including employees.

So far, the receivers said, they have realised over GHȻ 400 million through their sale and recovery efforts

"A key component of the Receiverships is to secure all assets including the recovery of outstanding loans and advances not assumed by GCB for the benefit of creditors. We have realised over GHȻ 400million through our sale and recovery efforts," the statement said.

Over the last twelve months, the Joint Receivers said they had been engaged in the process of winding down the activities of UT Bank Ltd. ("UT") and Capital Bank Ltd. ("Capital Bank").

Both banks went into receivership in August 2017, as a result of severe impairment of their capital. GCB Bank Ghana Limited, through a Purchase and Assumption Agreement signed with the Joint Receivers, purchased some assets and assumed certain liabilities of the two banks.

The Receivers in the statement said, the greatest value of the banks' assets is the loan stock, which constitutes approximately 70 per cent of the total assets of GHȻ 3.9 billion of the banks and this is at the heart of our recovery efforts, adding that the total loan stock of the two banks amounted to GHȻ 2.7billion as at the receivership date.

The creditor base of the two banks includes the Bank of Ghana, depositors, Development Finance Institutions, employees and trade suppliers of the two banks, it said, adding that, "We have made a request for creditors to submit their claims and proofs of debt for validation.

"Of a combined creditor claim of the two banks amounting to approximately GHȻ 4.4billion lodged with the Joint Receivers so far, we have validated and agreed claims worth approximately GHȻ 3.7billion," the statement said.

It said "The payment of creditors will be governed by the Banking and Specialised Deposit Taking Act 2016, Act 930 in the order of Secured Creditors, Bank of Ghana, and statutory amounts owed Government in taxes, wages and salaries owed employees among others."

adding that where there had been criminal activity, they have involved the Economic and Organised Crime Office (EOCO).

In the investigation of some of these criminal activities, the statement said EOCO had prepared several dockets and sent them to the Attorney General's Department for prosecution.

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