2019-02-01

18

alternative information

                      
                            Ghana will start a debt sale next month to prop up lenders as authorities seek GH¢2 billion ($403 million) in finance for banks undercapitalized banks.

The government created a special-purpose vehicle known as Ghana Amalgamated Trust, or GAT, which will use the debt sale’s proceeds to purchase shares in five lenders and help them meet a minimum capital threshold of GH¢400 million.

GAT will pay debt investors a once-off annualized rate of 21 percent when the bonds mature after five years, Managing Director Eric Otoo said in an interview in the capital, Accra. GAT will then seek to exit the holdings through buy-outs or listings on the local bourse, he said.

GAT’s formation and debt sale come in the closing stages of a sector cleanup during which lenders had to raise their capital holdings, a process which cut the number of banks by almost a third to 23.

The reforms announced in September 2017 triggered a series of capital-raising efforts while the government issued GH¢9.8 billion in bonds to cover the liabilities of poorly-managed lenders and protect depositors’ funds.

The five lenders that will receive funding from GAT didn’t meet the capital threshold but are soundly managed, said Otoo.

The beneficiaries are National Investment Bank Ltd., Agricultural Development Bank Ltd. UMB Bank Ltd., Prudential Bank Ltd. and the merged entity of BSIC Ghana and Omni Bank Ltd.

“It’s an arrangement to save the system, salvage the situation and allow the banks involved some time to pay back,” said Otoo.

A roadshow for the debt sale will start Feb. 18,Mr  Otoo said. The government will guarantee 70 percent of the sales, according to the finance ministry.

Source:Myjoyonline.com                            



ADVERTISE HERE

DESTINY DEVOTION

Join Alexander Kwabena Mayeyie on Destiny Radio every Tuesday and Wednesday for an awesome presence with the Lord

Enter Ad Details

Job Vacancy

Are you a marketer with an online marketing knowledge? Then Call: 0240146092 or Email: destinyradiogh1@gmail.com

LISTEN TO DESTINY RADIO GH: BREAKING NEWS | SPORTS | ENTERTAINMENT NEWS | POLITICAL NEWS |

Listen to intriguing, fascinating and captivating news, sports, entertainment, political news, etc on your mobile devices.