JoyBusiness is reliably informed that discussions are far advanced for the possible takeover of GHL Bank by First National Bank (FNB) soon.
Why the possible “takeover”
Sources say the planned takeover is being influenced by some difficulties by GHL bank in meeting the new minimum capital requirement of ¢400 million by end of this month.
This is because one of its major shareholders, Abraaj, a private equity firm based in Dubai which recently filed for bankruptcy, is having some challenges in helping GHL Bank recapitalise.
On the part of First National Bank, the move is more of a growth strategy. That is, helping it fast-track the process of becoming one of the biggest banks in the country.
First National Bank recently announced that it had met the new minimum capital requirement of ¢400 million, following some capital injection from its parent bank in South Africa.
According to sources, First National Bank is very strong in mortgage financing in South Africa and it is hoping to leverage on the GHL’s clients to be a dominant player in Ghana.
Capital Position of GHL Bank
Based on its published accounts on its website, as of September ending this year, GHL Bank had a stated Capital of ¢127 million.
Problems of Abraaj, the major shareholder in GHL Bank
Abraaj, the Middle East’s biggest private equity firm in June this year filed a petition in the Cayman Islands, asking the court to appoint PwC as provisional liquidators for the embattled company.
The move is to thwart separate legal action by the Kuwait Public Institution for Social Security (PIFSS) and another creditor, which are seeking the liquidation and winding up of Abraaj for non-payment of debt.
Dubai-based Abraaj has been trying to stem the fallout from a row with four of its investors, including the Bill & Melinda Gates Foundation and International Finance Corp (IFC), over how it used their money in a 1 billion healthcare fund. Abraaj has denied it misused the funds.
Regulators in Ghana and South Africa on planned “takeover”
Sources say even though the takeover talks have gone far, it is yet to secure the necessary regulatory approval from the regulators in Ghana and South Africa.
GHL Bank and its universal banking status
GHL Bank in June announced that it has secured a license from Bank of Ghana to operate as a Universal Bank. This was after it had operated as a Mortgage Finance Company over the past 10 years.