Recent happenings at ADB have not been pleasant in the eyes of the public and in the industry, it seemed disastrous for the bank as its public image is being affected immensely and the banking public confidence decreasing.

ADB workers

Workers are agitating and calling on the government for the removal of the managing director and the board of the bank accusing them of conflict of interest and financial improprieties.

They also wish the board and management?s decision to list on the stock exchange be abandoned, but their efforts seem flawed as more strategic and key stakeholders of the bank are not in support of the workers attempts to stop the listings.

The bank is expecting to raise about Ghc300 million to recapitalize and improve its operations to keep the institution in tune with current banking trends.

But, in efforts to pursue their demands on the government, the staff union of the Bank last week embarked on a nationwide sit down strike.

However, the management of the embattled Bank challenged the sit-down strike as illegal.

Though the staff union explained that, they have been compelled to take the decision due to government?s unwillingness to ask the MD and the board to step aside as the Bank of Ghana investigates allegations of financial malfeasance and conflict of interest leveled against them.

In response to the workers actions, various workers unions within the various sectors of the economy have added their voice to the numerous calls for the adb initial public offer to come on in order to save the Bank from further troubles.

Among the workers groups are the Trade Union Congress (TUC), farmers associations, Ghana Union Of Traders Association (GUTA), Ghana Federation of Labour (GFL) among others.

They are of the view that, the bank could be more prudent and financial capable and sound to do business in the competitive environment in which it founds itself as well as achieving its prime objective of financing agriculture activities in the country.

GUTA last week said it supports the adb Bank Ghana Limited?s intended stock market floatation, as this would raise capital for business expansion, and foster positive growth prospects.

?Banking is very important to us traders and businessmen?..This is a proactive step and we support wholeheartedly any move that would ensure the efficiency of the adb bank?, Mr George Kwaku Ofori, President of the GUTA told the media after a stakeholder consultation between the association and the bank?s management in Accra.

Recently, the Bank of Ghana also gave it words to the board of the Bank to go ahead with the listing on the stock market despite workers agitation against the move of listing.

A report by this paper last week noted that, the Central Bank backed embattled adb bank?s decision to list on the Ghana Stock Exchange as it continues its investigations into allegation of bad corporate governance and financial malfeasance in the running of the bank.

The Ghana Federation of Labour is of the view that, the move would be of benefit to the operations of the bank and the country as a whole.

?We are in support of the share floatation because this would generate the needed capital to overhaul the operations of the bank to make it profitable and more relevant in the financial sphere,? Abraham Koomson, Secretary-General of the GFL told the media in Accra after a meeting with the management of the adb.

Mr Koomson said many state assets were lost because they were not profitable, saying ?we cannot afford to lose this one too?.

?The adb?s move to list on the stock exchange is the way to go?we support the move. I commend the management of the bank, what they are doing is in the interest of both the bank and the country.?

?We urge all stakeholders to support this move because antecedents have shown that it is more beneficial to raise money on the market to revitalise the operations of the bank than to divest it,? he added.

The adb management has been consulting widely with stakeholders on the bank?s intention to list on the stock exchange.

The Farmers and Fishermen Award Winners Association of Ghana and the Ghana Union of Traders Association have all been engaged in the endeavour and they have also threw their unflinching support to the bank?s decision.

Those consultations are geared towards sensitising stakeholders on the outlook of the bank and to seek their support for the IPO.

Already, the adb bank has suspended plans to float shares to wait for the resolution of the investigation team commissioned by the Bank of Ghana.

Meanwhile, the Trades Union Congress is calling on government to investigate the cause of the dwindling fortunes of the Agricultural Development Bank (adb).

General Secretary of the TUC Kofi Asamoah claims the bank is borrowing GHC60 to GHC100 million from the interbank market on daily basis to survive.

He also says the bank has for the past three years not met the Bank of Ghana?s adequacy capital ratio. He wants government to investigate why the once well performing bank, is now under performing.

?We need to ask questions as to what has led adb to this state. Government and the President should delve deeper into this to find out what really has led adb to the situation,? he told an Accra based media firm.

?We are being told that those who are indebted to adb, [the amount] is higher than the amount of money they want to generate by going public, all these are things that Ghanaians should be told?something had gone wrong, and indeed we need to investigate and come out with what exactly has gone wrong,? he added.

When asked if a presidential committee would be the way to go, Mr. Asamoah responded in the affirmative.

Minister of State at the Presidency in charge of Private and Public Sector Rashid Pelpuo however defended the sale of state owned enterprises by government. He claimed they have been mismanaged over the years and used as an avenue to siphon government funds.

?State involvement in the setting up and running enterprises has not been successful and cannot be relied upon as a source of developing our economies and improving livelihood,? he said.

Mr Stephen Kporzdi, Managing Director of the adb, have explained that with the current ownership structure as a state-owned, the bank is unable to access medium and long-term funds from financial institutions like the IFC, CDC among others.

He therefore urged all strategic stakeholders of the bank to support the IPO, as this would ensure that the bank becomes an effective financial institution capable of growing business.

Currently, the Bank of Ghana (BoG) owns 48 per cent of the adb Bank, with the rest being owned by the government.

BoG is offsetting all its shares, because it cannot be a regulator and an operator at the same time. Government also seeks to whittle down its shares in the institution.

Some Financial analysts have over the years lamented that the Central Bank has been in a conflict of interest position because the regulator owns shares in adb.

According to the governor of the Bank of Ghana Dr. Henry Kofi Wampah, ?the problem is that we are the supervisors and normally we should not be supervising institutions that we have shares in. That is why I think it is very important that we look at this share sale and allow it to move on because it helps us remove that conflict of interest that the Central Bank has, in dealing with those banks?so I think we will continue to work towards at least to help achieve that IPO?.

The Bank of Ghana owns 48% stake in the bank while, government owns 52% stake. adb after getting cabinet approval originally wanted to float close to 100 million shares representing about 75% of the bank to raise about 420 million cedis.

Responding to the concerns of the workers , Dr. Wampah said ,?i believe that it is important to carry along all stakeholders , that is why it is important to dialogue with them , I?m not dismissing their complains outright?.

Source: Adnan A. Mohammed


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