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The National Investment Bank (NIB) of Ghana, currently grappling with liabilities exceeding GHc2 billion, is facing calls for significant restructuring to avert its potential liquidation. The Minority in Parliament has urged the government to intervene, emphasizing the systemic importance of NIB and the consequences of its collapse.
Isaac Adongo, the Ranking Member of Parliament’s Finance Committee, voiced his concerns during a press conference held on Thursday. He proposed that the government restructure NIB’s balance sheet by converting all NIB debts owed to the government into equity. Adongo questioned the government’s decision to consider liquidation, suggesting that hidden motives may be at play. He offered that the Minority could provide a team of experts to work independently and without interference to revitalize NIB.
Recent reports have indicated that the Agricultural Development Bank (ADB) is considering acquiring NIB. However, Dr. Richmond Atuahene, a banking consultant, warned against such a merger in their current states, as ADB may not have the capacity to take over NIB, which has been struggling for about six years now.
In July 2023, the Bank of Ghana (BoG) was in discussions with the government to assess the viability of NIB. The talks are expected to conclude next year and will determine NIB’s fate. Under the IMF program, BoG has committed to addressing the insolvency of NIB and under-capitalization of several special deposit-taking institutions (SDIs).
Following financial sector reforms, all banks operating in Ghana successfully recapitalized to GH¢400 million, except for NIB. The bank was given a government guarantee through the Ghana Amalgamated Trust (GAT), designed to help five banks recapitalize. However, NIB failed to utilize this opportunity due to its liquidity and capital challenges.
The Minority in Parliament has also affirmed that it will only support the approval of the $250 million World Bank facility for the financial stability fund if priority is given to struggling state banks.
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