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GH¢400m Capital Requirement: Council Of State Backs BoG

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The Council of State has advised local banks to consider merging in order to meet the new capital requirement by the Central Bank.

It comes after the banks petitioned the Presidency and the Council of State over the amount and timelines to achieve the new capital requirement.

The central bank last year raised the minimum capital requirement to GH¢400 million, equivalent to about US$100 million and commercial banks in the country have up to December 2018 to raise the amount, which represents a 333.3 per cent increase from the current minimum capital of GH¢120 million.

Banks were last recapitalized in 2012, when the BoG asked them to raise their stated capital from GH¢60 million at the time to the current GH¢120 million.

That round of recapitalization led to the consolidation of three banks, The Trust Bank (into Ecobank), Intercontinental Bank (into Access Bank) and Amalgamated Bank (into Bank of Africa).

In a statement after a meeting Thursday, the Council of State also urged the Central Bank to increase its monitoring activities in order to bolster confidence in the banking sector.

“The council advised indigenous banks which could not meet the bank of Ghana’s capital requirement to enter into mergers to compete favorably and ensure sanity in the banking sector”.

“While supporting measures so far taken by the bank of Ghana to ensure prudence in the banking sector, the council urged the bank to broaden its avenues for public engagement. Ultimately depositors interest must be protected at all times, and the public needs to be assured to boost confidence in the banking sector,” the statement stressed.

 

Source: Starrfmonline.com

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Our Fuel Is Safe – Radiance Petroleum

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The management of indigenous oil marketing company (OMC), Radiance Petroleum Limited, (RPL) has dispelled claims that its Kasoa Nyanyano branch has sold unclean fuel to some taxi drivers.

Nonetheless, the management of the company has launched investigations into the matter. It has taken samples of the product and reported the case to its Bulk Distribution Company and the National Petroleum Authority (NPA).

It has also intensified its security, monitoring and surveillance at all its 37 branches across the country to offer the best of services to customers.

“We are committed to our mission, which is: to provide the best fuel to our customers in ways that are compliant, profitable, reliable, safe and socially responsible. Customer service is paramount to our operation – nothing is more important to us than a satisfied customer – and we will go all length to ensure we are selling the right products and giving the right service to all who patronize our stations,” the General Manager of the company, Joseph Addae, said.

“Even though this is a complaint at only one of our stations, we have taken precautionary measures to ensure all our station never record such complaints.”

The company has been in existence for five years and is recording such a complaint for the first time. Since the inception of the deregulation exercise, Radiance Petroleum is among OMCs selling the cheapest and safest fuel in Ghana.

Radiance Petroleum Ltd. (RPL) is a limited liability company incorporated under the Companies Code of 1963 (Act 179).RPL is to leverage the expertise acquired in the sector in the last five years to position itself well to deliver excellent customer service.

The company, which has been operating in the downstream petroleum sector since March 2013, said customers should expect enhanced service delivery in line with safety.

The Managing Director of the Company, Emmanuel Pobee, explained that the first five years of operations have been a learning curve for the company to understand the business, its customers and what pertains in the industry.

“I will not say the first five years have been easy but I believe it has helped us learn a lot to help us improve going forward,” he said.

Radiance Petroleum Limited is a limited liability company incorporated in October 2012. The company loaded its first product on March 15, 2013. It currently operates in six regions and 37 service stations.

 

Source: Starrfmonline.com

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ECG: Meralco Selection Not Competitive – PUWU

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The Public Utilities Workers Union (PUWU) is questioning the competitiveness of the bidding process leading to the selection Meralco Consortium to manage the Electricity Company of Ghana (ECG).

According to him, it there was no iota of competitiveness in the selection of Meralco Consortium.

Meralco Consortium, according to a statement by the Millennium Development Authority (MiDA), “was determined to have the highest combined technical and financial score and has therefore been designated as the Preferred Bidder.”

Led by the Manila Electricity Company, Meralco Consortium, is an incorporated company in the Philippines, operating over the last 115 years.

“Its electricity distribution network covers a third of the Philippines and serves a customer population (Accounts) in excess of six million,” the MiDA statement signed by Director of Communication and Outreach Pamela Djamson-Tettey noted.

Commenting on the announcement by MiDA, the General Secretary of PUWU, Michael Adumattah Nyantekyi raised concerns over the competitiveness of the bidding process that led to the selection of Meralco Consortium.

Ahead of the announcement, CH Group pulled out of the bidding process leaving BXC Company Limited and Meralco Consortium.

Per the compact, the Millennium Challenge Corporation is expected to inject about $418 million into ECG, while Meralco will invest about $500 million.

“…By this announcement are they telling Ghanaians that this process has been very competitive? Because we know at a point it was left with only two bidders and if you are going through a process like this, you started with eleven companies, nine dropped out, living only two and you still go ahead and say you have selected one,” said Adumattah-Nyantekyi in a Starr News interview.

“Would you describe this as competitive process? Yes, you may have ended with one but then the big question is how competitive is the process?” he added.

MiDA, according to the statement by the Director of Communication and Outreach, will soon start finalizing the agreements related to the implementation of the ECG PSP Transaction.

 

Source: Starrfmonline.com

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Ghana, Nigeria Most Attractive Bond Markets – Research

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Ghana and Nigeria have been ranked as the most attractive Local and Euro Bond Markets on the continent, according to a new research carried out by South African-based Rand Merchant Bank.

The Research comes in the wake of the recent ranking of Ghana’s economy as the second fastest growing economy on the continent.

Finance Minister Ken Ofori Atta last week revealed the prospect of issuing a Samurai Bond is bright after leading a high powered government delegation to a Non-Deal roadshow in Japan.

Senior Global Market Researcher at the Rand Merchant Bank Celeste Fauconnier believes Ghana must continue with its fiscal consolidation measures in order to sustain investor confidence.

“If they had a portfolio that says you must invest anywhere in the world, Africa would have felt the pinch,” she said, wondering why would one want to be in Africa which is more risky than going into the US and European bonds.

The US and European bond markets, she said have dedicated African Funds and Ghana and Nigeria are benefiting from it because “they are the most attractive local bond market and Eurobond markets in our portfolio of countries.”

Zambia, she said used to be the most attractive bond market for investors but “unfortunately Zambia is shooting itself in its foot because, it is signing an IMF agreement.”

“We have actually seen London investors moving their investments into bonds from Zambia into Ghana. So Ghana has been benefiting,” she stated.

She thus urged the government of Ghana to continue its fiscal consolidation policy, warning that “any fear will move investors in the local bond market here [Ghana] to the Nigerian bond market.”

Earlier this year, the World Bank said Ghana’s macroeconomic outlook was largely positive based on the 2017 performance, with  GDP growth for 2017  estimated to have almost doubled from the 3.7 percent in 2016, and is expected to stay at that elevated level through 2018.

Also the external position, it said has improved as the trade balance has shifted to a surplus, but it needs to sustain the fiscal consolidation efforts.

 

Source: Starrfmonline.co

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