The owner of GN Bank, Dr Paa Kwesi Nduom has said the proposed merger with other banks does not mean that it could not meet the new capital requirement on its own.
He said this at a press meeting Thursday to speak about the Groupe Nduom's recapitalisation plan.
The former Minister of state also responded to reports of a “proposed marriage” with Sahel Sahara Bank and Premium Bank which is said to have fallen through.
GN Bank and Recapitalization Plan
Dr Nduom explained that the plan to merge with another bank was part of a whole plan to look at other options to support its recapitalization plan.
According to him “from the very beginning, we the shareholders met outside the country and we all agreed to take on responsibility on how much each one is going to raise.
“We all pledged that by the end of September, we were going to bring the respective capital as we planned ”.
Dr. Nduom noted that mergers if done right, gives one an additional strength.
“So is it not merger because we can raise money, but its a merger because we would raise what is to raise and strengthen the bank to be a Ghanaian owned bank.”
Supporting local banks
Dr. Nduom also made a passionate appeal to government to support local banks. He said the current challenge in the banking system which has resulted in panic withdrawals especially in local banks is not helping.
Below is the full statement from Dr Paa Kwesi Nduom
GN Bank To Meet GHS400 Million Capital Requirement
First, let me acknowledge the fact that it is a privilege to be a shareholder and also the Chairman of a regulated bank. It is not a right for anyone which is why there is a regulator and in the case of Ghana, that responsibility rests with the Bank of Ghana.
On September 11, 2017, the Bank of Ghana (“BOG”) directed that all banks licensed in Ghana must increase their minimum paid-up capital to GHS 400 Million. This has been a time consuming, stressful exercise on the part of Ghanaian-owned banks.
Unfortunately, recent events in the banking sector have not helped as they have tended to decrease confidence in our banks. So while the Bank of Ghana action was meant to strengthen the small banks, if care is not taken, it will rather weaken them.
So I wish to encourage Ghanaians including businesses and in particular pension funds made up of our own contributions to put and keep their monies in the Ghanaian-owned banks.
If Ghana is going to see accelerated development, it needs local banks. Indeed, it is local banks that cater to the needs of the rural economy. GN Bank has been a leader in the national retail market with 300 locations and presence in every region and in almost all districts.
On August 10, 2018, GN Bank submitted a roadmap to meeting this requirement to the Bank of Ghana for its review. If approved, the bank would meet or exceed the minimum capital requirement.
The shareholders of the bank are still fundraising with the hope to get to a minimum of GHS 600 Million by December 31, 2018. GN Bank is also participating in talks that if successful can lead to merging with other banks.
It is important to stress the fact that the right to approve paid-up capital contributions and mergers belong exclusively to the Bank of Ghana.
The BOG has pointed out challenges we need to overcome and we are working around the clock to resolve them all. So we have initiated discussions with BOG officials with the hope that they will grant approval to our capital and merger plans very soon.
In the meantime, I wish to appeal to everyone that GN Bank and the other Ghanaian-owned banks need deposits and emotional support to remain open, to be safe and sound, and liquid.
Management, directors and shareholders appreciate the loyalty of GN Bank’s over 1.2 million customers across the country.
Have your say
More Business Headlines
- Ghana, Cote d'Ivoire resume sale of cocoa beans
- UBA unveils marketing platform for entrepreneurs
- BoG keeps policy rate at 16%
- Electric car models to triple in Europe by 2021
- Boeing to take $4.9bn hit in second quarter on 737 Max grounding
- Ghana's debt now GHS200 billion
- Gov’t urged to formulate new tax compliance rules for increased revenue
- Vodafone talks private sector relevance in SDGs at UN Forum
- Nelson Mandela Day: Barclays, ALU scholars pay courtesy call on SA High Commissioner
- Insurance industry could wield more money than banks – Rev Okosun
- Engage NIC to avoid casualties - CIIG
- Kingdom Exim Ghana, CEO awarded at Ghana Shippers Award 2019
- Enforce laws barring foreigners from retail trade - Majority Leader to agencies
- GTBank, Ria partner Zeepay to launch Ria2Mobile money transfer service
- AirtelTigo mentors 40 young aspiring entrepreneurs