Tuesday, 12 December 2017
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Some employees of UT, Capital Banks face retrenchment – BoG cautions

Some employees of UT, Capital Banks face retrenchment – BoG cautions Featured

The Central Bank has hinted at the possibility of job losses at two collapsed banks, UT and Capital Banks as GCB Bank rolls out its restructuring process, after acquiring them.

The revelation by the financial regulator feeds into the fear of the over 900 staff of the two banks that they will be laid off following the transaction.

 

Head of Banking Supervision at Bank of Ghana, Raymond Amanfo told Joy Business’ George Wiafe the decision on the number of employees to retain at the two banks rests with the consolidator.

“For the first three months up to six months they [GCB Bank] are retaining all branches and they will manage all the staff,” he revealed, adding things might change after that.

The Bank of Ghana on Monday gave its approval for the purchase of UT Bank Limited and Capital Bank Limited by GCB Bank Limited.

 

The two banks have a severe capital impairment, the Central Bank has said, revoking the licenses of the banks.

The Bank explained it selected GCB bank over three others because of its competitive edge on the basis of “purchase price, cost of funding and acquiring bank’s capital adequacy ratio.”

Per the policy of the Central Bank, any bank that wants to operate in Ghana needs not less than ¢60 million.

After operating as a fully-fledged bank for eight years, the banking regulator said UT Bank and Capital Bank are too distressed to exist.

Sections of Ghanaians raised critical issues about the deal, especially with the way the sale was kept away from the employees. Others want Bank of Ghana to assure them no employee would be laid off.

But Mr Amanfo said to the extent that some of the collapsed banks have branches close to GCB Bank, some of the workers might be asked to go home.

“Definitely a few of the branches will be closed or merged. They [GCB bank] may take some staff [and] they may lay some off,” he cautioned.

When George asked him about the status of the five other banks initially described as distressed, Mr Amanfo said they have met the capital requirement of the Central Bank.

Last modified on Tuesday, 15 August 2017 13:20