The Ghana Amalgamated Trust (GAT) has begun engagements with organised labour to come to terms and cure the bad blood festering over use of pension funds to shore up indigenous banks.
According to Angel Kabonu; National Association of Graduate Teachers president, despite speculation in town, the meeting a few days ago with labour unions was the first since the issue of using pension funds to support ailing banks was broached by government.
Economist Dr. Lord Mensah believes the bond issue can help further strengthen the remaining banks with good governance structure but weak cash reserves.
Meanwhile banker and investment expert, Albert Essien has been named the Board Chairman of the GAT. He is expected to bring his expertise to bear in raising funds for the entity.
Investment banker, Eric Nana Otoo is to serve as Managing Director while other board members include Susan Ohene, Sampson Akligoh and Abenaa Kessewaa Brown.
However agitation persists about using pension funds to prop up banks whose actions or inactions led them into difficulties.
The Ministry of Finance came up with the Ghana Amalgamated Trust initiative after the deadline for universal banks in the country to recapitalise to GHc400m was not met by some supposedly well-run but under-capitalised banks.
General Secretary for the Federation of Labour, Abraham Koomson, also does not favour government’s decision to use pension funds for the GAT project threatening the federation could head to court to impede the move.
The beneficiaries of the GAT programme are Agricultural Development Bank (ADB), National Investment Bank (NIB), OmniBank Ghana Limited/Bank Sahel Sahara Ghana (OmniBank / BSIC), Universal Merchant Bank (UMB) and Prudential Bank.
The objective of the GAT is to raise funds from the private sector, mainly Pension Funds, to support eligible indigenous banks that successfully completed the due diligence process with the qualifying banks for GAT investment having been determined on the basis of their solvency, local ownership, minimum pre-investment capitalization of GHc120 million and an independent valuation by PricewaterhouseCoopers Ghana.
The Finance Ministry in a statement also declared:
“GAT has committed funds from pension funds and other investors, through a bond programme, with proceeds of up to GHc2.0 billion to be used for equity investment in the eligible indigenous banks, as determined by the investors. The bonds issued to the Pension Funds will be listed on the Ghana Fixed Income Market (GFIM) for liquidity purposes.”
