[2008-04-21]  More Banks Move To Recapitalise
Read Latest Media HFC, Ecobank and Cal banks are moving vigorously to shore up their stated capital, following Bank of Ghana’s announcement of a new minimum capital requirement of GH¢60 million by the end of 2009 for exotic banks and 2012 for local banks.

All the three banks announced at their recent annual general meetings that they will raise additional shares through Rights Issue though shareholders of Cal Bank had earlier rejected the move for further explanation in their financial statement.

What makes it interesting is that the two banks involved are indigenous banks who had earlier proposed a spread of the recapitalization process over seven years through a plea by the Association of Indigenous Banks but the impressive performance of the banks during the 2007 financial year is pushing them to raise the additional capital soon.

HFC Bank could be the first to embark upon the Rights Issue as it announced yesterday at the Ghana Stock Exchange-organized “Facts Behind Figures” programme.

Asare Akuffo, Managing Director of the bank pointed out that though his outfit has made its intention clear before the Central Bank’s announcement, it will issue GH¢10 million, and the amount to be raised will help shore up its stated capital.

Presently the prospectus of the Rights Issue is with the Securities and Exchange Commission (SEC) and the bank is hoping by June this year, it will begin selling the shares.

Both Ecobank and Cal Banks are also preparing their draft prospectus meant for the issuing of additional shares through the capital market.

This will apparently be done in collaboration with the sponsoring brokers.

Meanwhile, HFC Bank says it will improve upon the modest gains in its mortgage portfolio.

The Home Loan business could not grow at the anticipated rate due to the extremely limited supply of affordable and middle income housing on the market but Mr. Akuffo believes HFC would see tremendous growth this year to confirm their dominance.

It is also considering expanding from the current 13 branches to 20 at the end of the year.

The move according to him, is part of HFC’s vision of setting up at strategic locations.


Source: (C)copyright 2008 M.C MODERN GHANA