A new report conducted by the Receivers, Vish Ashiagbor and Eric Nana Nipah of PWC on the assets and liabilities of the defunct Capital Bank has revealed that loans granted to shareholder was more than half of the total loans and advances granted.
According to the inventory report, shareholders’ loan amounted to GH¢749 million and has been in default for over three years. This means that the total loans granted the owners of the bank was equal to 65% of the bank’s loans and advances granted by the bank.
The report also revealed that the defunct bank had loans and advances of approximately GH¢1.2 billion, accounting for 44% of the bank’s total assets as of 14th August 2017.
“The revised asset position of Capital Bank as of 14th August, 2017, was approximately GH¢1.4 billion. We continue to review the bank’s records to ascertain its accurate asset position”.
Receivers
The Receivers further indicated that “an initial assessment of Capital Bank’s assets indicates impairments of approximately GH¢1.4 billion.”
“The total assets of Capital Bank were approximately GH¢2.6 billion as of 14th August 2017. However, from our initial assessment and Asset Quality Review we have adjusted the value of Capital Bank’s Assets to approximately GH¢1.4 billion. This value includes asset balances purchased by GCB per the Purchased and Acquisition Agreement”.
Receivers
Cash After Liquidation
The report further disclosed that the cash counted on day one after liquidation was approximately GH¢2.4 million, lower than the GH¢19.5 million stated in the Management Account and General Ledger.
“On day one, we performed a physical count of cash held in vaults at the bank’s head office and branch network (25 branches). This was done in conjunction with GCB and Bank of Ghana (BoG) representatives. Total cash counted was the cedi equivalent of GH¢17.1m. The cash counted on day one was approximately GH¢2.4 million, lower than the ¢19.5 million stated in the Management Account and General Ledger.”
Receivers
Afterwards, the report noted that GCB assumed all the cash in Capital Bank in line with the Purchase and Assumption arrangement, adding “the cash was handed over on 14thAugust 2017, following a sign off of count sheets by GCB and BoG representatives”.
Total Foreign Accounts
Again, the Receivers report revealed that a review of documents available at Capital Bank and the nostro account statements indicated that the total balance of Capital Bank’s accounts with correspondent banks was approximately GH¢10.7 million. This was due to a deposit of almost GH¢210.1 million with BHF Bank, Frankfurt that was wrongly duplicated.
However, per the management records of the bank as at revocation date, Capital Bank maintained 30 foreign currency accounts (Nostro Accounts) with various correspondent Banks. The cedi equivalent of balances in these accounts was approximately GH¢220.8m as of 14th August, 2017.
For investments, the Receiver identified that Capital Bank’s long term Investments which related to two equity investments, amounted to GH¢303,000.
These comprised of a 100% investment in Capital Bank Investment Services Limited, valued at approximately GH¢300,000 and Capital Bank’s shares in Ecobank Transnational Incorporation valued at GH¢2,500 as of 14th August, 2017.
“These values are at cost and the current values are likely to be much higher than what is reflected in the Bank’s books. We will ascertain the current values of the shares and realise them appropriately”.
Receivers
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