Perhaps tired of being a Savings and Loans company after three years, ambitious shareholders of First Capital Plus planned to become a bank but they needed ¢60m.

It has turned out they did not need ¢60m, they needed the BoG to just look the other way. And in December 2013, they did.

According to an exclusive report, the central bank was either complacent or complicit when shareholders of First Capital Savings and Loans company were awarded a provisional licence in July 2013 and a full licence later in December 2013.

Capital Bank shareholders had only ¢23.3m - less than 50% of the ¢60m capital requirement. In their defence, they also produced evidence to show they had  ¢51.5m illiquid investment - basically money that you can see but cannot touch.

They could sell of these liquid investments and get more than they needed to meet regulations.

A convinced BoG headed by Dr. Henry Kofi Wampah granted them a provisional licence with clear instructions to find the additional ¢36.7m and lodge it in "an escrow account which should be verified by the Bank of Ghana."

But on D-Day of obtaining a final approval to operate as a bank, Capital bank shareholders showed they had put their monies in other financial institutions and not the escrow account they were directed to open.

In essence, they showed to BoG, they had the money but BoG never saw the money. Somehow BoG was satisfied with this explanation which their regulations does not allow it to be satisfied with and granted Capital Bank a final licence.

Photo: Founder  of the bank William Ato Essien is under investigation by EOCO

The report states "This has now been confirmed to be the genesis of the capital adequacy issues of the Capital Bank."

It continues to state that "the new funds were never transferred to the Capital Bank" and began to refer to it as "re-engineered capital."

The bank therefore was doomed to struggle right from day one of its newly acquired class 1 bank status.

The report states BoG was repeatedly informed by their Bank Supervision Department of the glaring infractions but "there is no evidence of sanctions to either the institutions concerned or the individuals in senior management and on the Board of Directors."

In a 2015 Capital Bank examination report, only four out of 24 problems were identified by bank inspectors. Some of the items not rectified included "weak board oversight of the bank's risk management oversight function."

The report castigates the Board of Capital bank for what the reports describes as "simply negligence" or "wilful misconduct" in failing to implement 2014 BoG recommendations to the bank.

The BoG did not consider that its inactions was going to eventually hurt customers of the bank and the general public, the report indicated.

But it got worse after the BoG pumped ¢610m into the struggling bank in October, 2015. Part of that money was eventually used to set up another bank, Sovereign Bank in January 2016 which also collapsed in August 2018.

BoG has not been able to retrieve the bail-out money to Capital Bank and the Ghanaian-owned bank headed by Rev. Fitzgerald Odonkor and founded by William Ato Essien collapsed in August 2017.

Capital Bank which began in October 2009 as a First Capital Plus, a microfinance company, and progressed into First Capital Plus Saving and Loans Company.

All its 15 branches in five regions and 355 branches were absorbed into GCB bank. Several staff were later laid off and stories of their miseries have been unending.