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Minority kicks against handing over NIB to ADB over liquidity challenges

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Minority kicks against handing over NIB to ADB over liquidity challenges

8 months ago
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The Minority in Parliament has kicked against moves by the Bank of Ghana (BoG) to hand over the National Investment Bank (NIB) to the Agricultural Development Bank (ADB).

According to the NDC MPs, the move smacks of conflict of interest since the Bank of Ghana owns over 60% stake in ADB.

Addressing the media in Parliament Ranking member for Finance Committee, Isaac Adongo accused the Nana Addo administration of seeking to sell NIB to cronies through the backdoor.

The Bolgatanga Central MP shared some ideas with government which he believes can make the troubled NIB stand on its feet without government selling it off.

“Ladies and Gentlemen, it is instructive to note that every viable and constructive alternative proposals by well- meaning Ghanaians aimed at resolving the problems of NIB to retain and revive a largely systemic Bank were bluntly ignored.

“NIB’s biggest problem is that it is suffering from capitalization deficit of GHC2.4 billion. However, a casual review of NIB’s balance sheet shows that a restructuring of the balance sheet can generate in excess of GHC2.75 billion to wipe of the GHC2.4 billion and leave a free shareholders fund and equity of about GHS350 million towards recapitalization and a total cash injection of GH2.8b. It is therefore puzzling that anybody sitting on this gold mine will attempt to give it out to somebody for peanut.

“I wish to state here, that some of the proposals that were ignored are still very important today to remedy the situation.

These include but are not limited to the following:

“Sale of NIB’s 24% shares in Nestle Ghana acquired at Ghc50 million a long time ago, that were given a conservative value of Ghc500million in 2018.This singular proposal would have generated a risk-free cash of Ghc500million to NIB and provided a realized capital gain of Ghc450 million for ecapitalisation. Strangely, this was either ignored or lost on Hon. Ken Ofori Atta, who rather opted to take the shares in Nestle and swap it with a Ghc500 million government bond plus a further Ghc800million government debt as deposit for shares. As it turned out, those bonds have since been impaired through the poor conduct of the Finance Minister in the infamous and unending DDEP consistent with IFRS 9.”

 

source: Starrfm.com