Ministry assures customers of liquidated banks

Trading record low volumes

Ghana embraces new lending facility but urges no strings

Official liquidator gives details on where depositors of failed banks should go

Accra (Greater Accra), 20^th January 2000

The Ministry of Finance has assured customers of the two liquidated banks -- Bank for Housing and Construction (BHC) and Co-operative Bank -- that it is taking appropriate measures to enable to them have access to their accounts as early as possible.

"In this regard, the Ministry has requested the liquidator and the consultants to expedite the process of verification of depositors' accounts in order that customers of the two banks can have access to their monies," a source at the Ministry told the Ghana News Agency GNA, in an interview in Accra on Wednesday.

Meanwhile investigations have revealed that the two banks have been in troubled waters since 1997, due to several factors including the A-Life scandal.

A Bank of Ghana source said the central bank had to clean its records of 43 billion cedis deficit on behalf of the two banks in order to keep them afloat since 1998, adding that "even with all this, the banks continued to sink deeper and deeper into crises."

It also came to light that especially in the case of Co-operative Bank, it had begun to utilise depositors lodgements to cover various administrative expenses and even pay salaries.

"If the liquidation had not taken place at this present time, the banks would have collapsed anyway -- it was only a matter of time," the source told GNA.

He revealed that the A-Life case is still pending and being pursued at the courts, adding that "it is hoped the case would be expedited so that those found to have engaged in any wrong-doing would be brought to justice."

GRi

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Accra (Greater Accra), 20^th January 2000

Bearish sentiments of low price appreciation and low volumes characterised trading activities on the Accra bourse on Wednesday.

The All-Share Index, the main market indicator of the Exchange registered a merely 0.02 points gain to reach 740.07 points from 740.05 with other market indicators recording modest gains.

The change in the year to date however remained at 0.53 per cent as two equities declined in price as against one gainer.

Total shares traded ended higher at 59,200 compared to Monday's 23,100 shares with bids moving up from 83,200 to 98,150 shares.

Offers continued to dominate trade closing the day at 462,970 from 452,530 shares.

Market capitalisation registered an increase but by a small margin from 3,211.56 billion cedis compared to the previous 3,211.53 billion cedis.

In the broader market, there were three price changes - one up and two down.

British-American Tobacco Company (BAT) and Mechanical Lloyd Company Limited (MLC) lost a cedi each to close at 467 cedis and 150 cedis respectively.

Fan Milk Limited (FML) gained seven cedis at 930 cedis.

The following are the last prices of listed equities in cedis:

ABL 470

AGC 18,700

ALW 2,489

BAT 467 -1

CFAO 38

EIC 1,880

FML 930 +7

GBL 1,450

GCB 770

GGL 950

HFC 750

MGL 200

MLC 150 -1

MOGL 13,900

PAF 298

PZ 800

SCB 19,200

SPPC 150

SSB 1,988

UNIL 1,850

UTC-E 125

CMLT 420

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Ghana has expressed support for the new Poverty Reduction and Growth Facility (PRFG) as the blue-print for donor assistance to Sub-Saharan Africa.

The Vice President, Professor John Evans Atta Mills, said however that the new tool should be flexible to avoid rigidities of its predecessor, the Enhanced Structural Adjustment Facility (ESAF), which emphasised benchmark and exact performance dates.

Prof. Atta Mills, who led Ghana's delegation to the summit on Poverty Reduction and Economic growth in Sub-Saharan Africa in the Gabonese capital on Wednesday, emphasised at the Executive session that "there should be no new conditionalities with the new tool, except for those agreed by the countries themselves in their proposals."

The PRFG is designed to take a more "inclusive approach" to macro-economic restructuring, encouraging development agencies and various civil society organisations to contribute towards poverty reduction and to stimulate growth.

Unlike ESAF, often criticised for its overemphasis on strict budget deficit as well as growth and inflation targets, which implementing countries hardly met, PRGF puts the onus of designing an adjustment programme on the recipient.

The summit, attended by a dozen of African Heads of State and governments, deliberated on "the agenda for Africa on the dawn of the new millennium," focusing on the challenges of accelerating economic growth and eliminating poverty.

It also discussed the AIDS menace and its devastating effects on the continent.

The Heads of State included Presidents Gnassingbe Eyadema of Togo, Abdou Diouf of Senegal, Zambia's Frederick Chiluba, Alpha Konare of Mali, Arap Moi of Kenya, Blaise Compaore of Burkina Faso and Sassou Nguesso of Congo Brazaville and host, President Omar Bongo.

Vice President Atta Mills urged the Heads of State to do everything possible to remove the stigma of high political risk attached to countries on the continent, saying, this is largely responsible for the low inflow of foreign direct investment and the dwindling of official development assistance.

"Africa needs peace and stability and an end to conflicts if she is to develop".

Vice-President Mills also held talks with the outgoing Managing Director of the International Monetary Fund (IMF), Mr Michel Camdessus.

The Ghanaian delegation included Mr Kwame Peprah, Minister of Finance, who

also served as a leading rappoteur at the conference, and Mr Kwamena Ahwoi, Minister designate for the newly created portfolio of Regional Integration and Cooperation.

Also at the summit were the country representatives of the World Bank and IMF.

A communiqué was issued on the theme and a resolution passed on the HIV /AIDS menace, which experts say has reached alarming levels on the continent.

A proposal was made to declare the first decade of the millennium as the "Africa decade of growth and Poverty Reduction."

The summit set up a six-member Follow-up Committee including Ghana to monitor the implementation of decisions.

The delegation returned home on Wednesday.

While in Gabon, it interacted with a cross section of the Ghanaian community in Libreville.

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Accra (Greater Accra), 20^th January 2000

The official liquidator of Bank for Housing and Construction and the Ghana Cooperative Bank on Thursday gave details of specific banks where accounts of depositors have been transferred.

A statement issued by the liquidator’s office said the government, recognising the adverse impact of the liquidation of the two banks on depositors, has put in place arrangements to adequately protect their interests.

The government will underwrite the losses that depositors would "otherwise have suffered in their capacity as unsecured creditors of the failed banks."

It said government will arrange for funds to be deposited to the credit of each depositor at the branch of either Agricultural Development Bank (ADB) or Ghana Commercial Bank (GCB) that is near to the branches of the failed banks at which depositors had their counts.

Depositors will be requested to complete account opening procedures and other formalities only at the banks their accounts have been transferred to.

The statement said depositors will be expected to bring with them proof of identity such as their voter's identity cards, passports, driver's licence or an employer's identity card with the photograph of the holder.

"Funds being credited to each depositor will be equal to the verified balances of the date of liquidation inclusive of accrued interest due to the depositor and adjusted by any loans or advances owed to BHC or to Cooperative Bank by the depositor."

The liquidator said efforts are being made by "a large team of professional staff" with selected members of the accounting staff of the banks to complete the processing of the transfer of these deposits as quickly as possible.

"By the end of this week, the first batches of deposit transfers will have been completed in each branch and the depositors will be able to have immediate access to their deposits."

GRi