By William
Yaw Owusu
Tuesday August
14 , 2018
The
reported ‘fraudulent’ deals at UT Bank, which contributed to its total collapse
last year, are beginning to unravel, as one of the major debtors, Ibrahim
Mahama, scurries for cover over his role.
UT
Bank alone is said to have been given over GH¢860 million by the Bank of Ghana
(BoG) as lifeline but still couldn’t survive the mounting bad loans granted to
its customers which culminated in its final collapse.
Ibrahim Factor
According
to a leaked report of the team commissioned by the Bank of Ghana (BoG) to investigate
the collapsed UT and Capital Banks, the UT Bank, which was a listed company on
the Ghana Stock Exchange (GSE), was heavily indebted, as companies belonging to
Ibrahim Mahama, junior brother of former President John Mahama, owed over GH¢300 million,
which was not repaid.
The report, which was submitted to the Banking
Supervision Department (BSD) of the Central Bank by Boulders Advisors Limited
(BAL), in January 2018, listed Dzata Cement, Holman Brothers Ltd, MBG Ltd and
Engineers and Planners as companies owned by Ibrahim Mahama, which took loans
from UT Bank but could not repay them to the bank.
Dzata
Cement alone was said to have received GH¢131.5m from UT Bank while the rest of
the four companies reportedly received GH¢261.4m from the collapsed bank
managed by Prince Kofi Amoabeng.
Ibrahim
Counter-Attack
Ibrahim
Mahama has mounted a swift counter-attack, saying he did no wrong because the
loans he acquired for his businesses were ‘over-collateralized.’
He
sent journalists to tour the said Dzata Cement over the weekend and said the
facility was 80 percent complete.
Interestingly,
Dzata Cement, a bagging cement company’s component of the loan, was less than
half of the over GH¢300 million facility
advanced to Ibrahim’s companies.
One
of his lawyers, Reindorf Twumasi, in a statement issued on behalf of Ibrahim
Mahama later, said “the sum of money put out there as the amount owed by companies
'owned' by Ibrahim Mahama is not accurate and not a reflection of the facts and
documents.
He
appeared to be saying that the whole report was skewed.
“It
was agreed that UT Bank will finance the cement factory till it becomes
operational but this unfortunately could not happen due to the revocation of
its licence last year. At the time the bank's licence was revoked, the records
will show that the project was about 80 percent complete. Due to the unexpected
revocation or the bank's licence Dzata had to resort to other financiers for
support to complete the project. In February 2018, Government of Ghana gave the
Cement company clearance to import 1.2 million metric tonnes of bulk cement for
re-bagging based on evidence of installed bagging plant,” the lawyer said.
However,
according to the report, UT tried fruitlessly to recoup the loan facility advanced
to Ibrahim without success leading to its eventual collapse.
This
is not the first time Ibrahim has contributed to the collapse of a local bank,
as Merchant Bank went under due to Ibrahim’s failure to settle the debts.
Ibrahim’s
lawyer stated: “It must also be noted that Mr. Ibrahim Mahama did not
contribute in any way towards the 'collapse' of UT Bank. The evidence available
to the bank will show clearly that the loans taken by Dzata Cement were over
collateralized. The report purportedly making the rounds in the media may have
been skewed or misrepresents the facts and therefore should be dismissed.”
Amoabeng’s Angle
Already,
Prince Kofi Amoabeng, the businessman, who set up then vibrant Unique Trust
Financial Services, which later became UT Bank, has come under public scrutiny
over the role he might have played in the total collapse of the bank.
The
report said Mr. Amoabeng did not disclose the receipt of some GH¢5 million paid
to him by Kofi Jobs Limited believed to be one of the companies linked to
Ibrahim Mahama, which happens to be a debtor of the bank.
This
was after the bank authorised an advance payment guarantee from Engineers and
Planners, which settled Kofi Job Ltd’s indebtedness to the bank.
House Deal
Mr.
Amoabeng, according to the bank, however, explained that he sold his house to
Mr. Kofi Jobs Gyebi, hence the payment of that GH¢5 million to him.
The
report further said Mr. Amoabeng also breached ‘single obligor’ limits for
Ibrahim Mahama’s connected companies of Holman Brothers, Kofi Jobs, Dzata
Cement, MBG Limited and Engineers & Planners Limited.
The
single
obligor limit, according to the report, is
the maximum amount a bank is allowed to lend a single borrower or an individual in
relation to the total shareholders' fund of that bank.
For
instance, Mr. Amoabeng, who exited UT Bank, extended additional credit to
Holman Brothers by pledging a $5 million placement as collateral security with
Beige Savings and Loans to extend a $5 million loan to Holman Brothers during
his tenure.
UT Holdings
The
report said Mr. Amoabeng as UT Bank boss consistently signed investment
placement deals on behalf of both the UT Bank and UT Holdings, explaining
“several deposit investments were placed with UT Holdings Limited and not
recorded as liabilities and assets on the UT Bank’s books.”
This
was evidenced by minutes of the 1st ordinary meeting of the bank’s board for
2016, which said: “Payments of up to
GHS6.9 million for matured fixed deposits were made to customers who claimed to
have had investments with the bank.
Even though these deposits could not be
traced in the system, payments were made following internal audit
investigations. There is an urgent need to address this growing account
balance.”
Inter-Group Lending
The
team also found out that there was a significant amount of inter-group lending
involving other subsidiaries of the holding company, UT Holdings of GH¢71.6
million and $14.3 million and the connected party loans were made to Ibrahim
Mahama’s related companies, amounting to GH¢261.4 million and $6.4 million,
Quincy Sintim’s related companies amounting to GH¢84.1 million, and Beige
Group’s related companies, amounting to GH¢10.9 million.
“The
bank sought a waiver of the Ibrahim Mahama related companies’ single obligor
violations by the bank, yet undertook a pass through $6.4 million transaction
by giving Beige Capital Savings and Loans a $5m placement as guarantee for
Beige to extend a $5 million loan to Holman Brothers.”
UT Bank, at an emergency meeting, according to the report,
expressed concern about Ibrahim Mahama’s inability
to meet his obligations to the bank on May 20, 2016 and said he made no effort
to honour any of the assurances he gave when he met UT Bank on 29th
March, 2016 although as at May 2016 his total exposure was approximately GH¢302
million.
“The board requested a meeting to be
arranged between the board chairman, Mr. P.K. Amoabeng on one hand, and
President Mahama, Mr. Ibrahim Mahama and Mrs. Mona Quartey, on the other, to
discuss the way forward,” adding “the board met with Mr. Adi-Ayitevi as
representing Mr. Ibrahim Mahama. The board expressed its disappointment with
Mr. Ibrahim Mahama; its members felt slighted and disrespected by his actions
and questioned his credibility as a businessman.”
Ibrahim begs
The
report stated that at the emergency board of directors’ meeting on 3rd June
2016, Ibrahim Mahama met the board to discuss his non-performing loans.
At
this meeting, Mr. Mahama indicated that he was making every effort to pay the
amounts outstanding from related companies.
He,
however, asked that the bank should grant an advanced payment guarantee (“APG”)
of GH¢28.6m to enable Kofi Jobs mobilize funds for projects.
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