Investment banker Iddrisu Mahama Alhassan, has said he is not surprised that five local banks have gone under.
The five are The Royal Bank, BEIGE Bank, Sovereign Bank, The Construction Bank and uniBank.
They have been fused together into one bank by the Bank of Ghana since they will not be able to meet the GHS400 million minimum capital requirement.
The resultant bank is called Consolidated Bank Ghana Limited. Central Bank Governor Dr Ernest Addison explained on Wednesday, 1 August 2018 that the move was part of measures to streamline the financial sector.
Speaking on Class91.3FMâ€™s Executive Breakfast Show on Thursday, 2 August, Mr Iddrisu Alhassan told Moro Awudu that: â€œWhat has happened is not surprising.â€
Read: â€˜Itâ€™s not a mergerâ€™; the banks were already â€˜kaputâ€™ â€“ Joe Jackson
â€œAt least, having been involved in raising capital for three, four or five of them; and people come, they look at the paper report, they are OK. They go into the software and it gets sick, and you can see that even the capital that is reported and you prepare a certain memorandum and do all the things that youâ€™re supposed to do and you say for due diligence letâ€™s do some one or two checks, and then you go inside, the money is not even there and we are like: we are not interested in this and we have tried four, five banks and it wasnâ€™t possible.
â€œWeâ€™ve seen other colleagues who have mandates and we say: OK, let me see what they have, you flip through and you donâ€™t get encouraged to go and look for the money.
â€œThat was when I realised that the Bank of Ghana hasnâ€™t finished and theyâ€™ve proffered merger of the banks and everybody is looking at the other private business that heâ€™s doing that is linked to the bank.
â€œAnd, so, when they are talking about mergers, they are not talking about who sits as the MD, they are actually thinking about what they will lose if they merge. And I keep telling people to tell the other partner that â€˜this is the business I do in the bankâ€™; will it be possible when we consolidate? But everyone is keeping his secret in his bag because he thinks that if one knows â€¦ but the central bank knows. And Iâ€™m not surprised and I thought that even with this news, the central bank hasnâ€™t finishedâ€.