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Restructuring not needed, NIB needs cash – Banking consultant

A banking consultant, has opposed the idea of restructuring the National Investment Bank (NIB). In his view, what the bank requires is increased liquidity, not restructuring.

The minority had previously suggested an alternative to transferring NIB’s operations to the Agricultural Development Bank (ADB), proposing a restructuring of NIB’s balance sheet. This would involve converting loans and outstanding debts into equity.

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However, Atuahene argues that restructuring alone does not address the core issue, as it does not provide the bank with the necessary liquidity.

“NIB doesn’t need equity so the government cannot turn the unpaid loans into equity. NIB needs liquidity; it needs cash and is not about restructuring the financial position. If you convert the unpaid loans into equity, that’s not cash injection. NIB is cash-strapped. So, we need someone to bring in liquidity after clearing the bad debts so the bank can run,” he was quoted by citinewsroom.com.

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Dr. Atuahene further stated that merging NIB with ADB is not the best option because the Agric Development Bank is currently unable to take on NIB.

“We should only make sure that there is a proper cash injection from all the loans so the bank can come back. Looking at the current position of NIB for a takeover, it is not ADB because ADB doesn’t have the strength,” he added.

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