Professor Lord Mensah, speaking on JoyNews’ PM Express on Wednesday, July 30, insisted that the decisions taken at the time did not reflect sound banking practice.

“In banking, there’s what we call minimising the loss and then maximising the recovery. And for me, this is a principle that’s a baseline for banking activities, be it at the central bank level or the lower bank level,” he said.

“So for me, these principles were not applied…when we had the banking crisis.”

He cited the widely accepted notion of “too big to fail” and explained that banks don’t exist in isolation.

“The existence of a bank takes several dimensions… You’re looking at government interest in there. You’re looking at employees’ interest. You’re looking at owners’ interest in the bank,” he argued.

“So if a bank is about to collapse, you don’t look at just the owner’s perspective alone and say that the owners are not able to meet certain financial obligations…You have to look at what the government is getting from the bank.”

He pointed out that banks were contributing corporate tax between 25% – 30% at the time, and that many families depended on these institutions for their livelihoods.

“People who are working and able to put food on the table for their kids… they’ve been able to manage their homes, put their kids to certain levels of education,” he said.

“So if you collapse the bank as a result of pushing for the interest of the government, you end up sacrificing employees and at the same time, the state.”

Prof. Mensah noted that UniBank was reportedly owing GH¢4.97 billion, but had offered GH¢2 billion in recovery.

“You have to take it,” he said. “Because in banking, as I mentioned earlier, you think about recovery, and then you minimise the possible losses.”

He described the entire clean-up process as one that neglected core principles of the banking system.

“You come to realise that the principles of banking were not followed at the time… we were cleaning up the banking sector.”

He referenced fellow panellist and legal practitioner Martin Kpebu, saying, “That is where my good friend Martin Kpebu will say that the motive was more of witch hunting than following banking principles.”

Prof. Mensah questioned the rationale behind ignoring recovery opportunities and instead transferring full financial burdens to taxpayers.

“You’re talking about recovering GH¢2 billion… So why do you collapse the bank and then transfer all the possible obligations to the taxpayer to the point where the taxpayer had to commit about GH¢21 billion and over for the banking sector clean-up when you can retrieve, or you can recover some part of this money from the banks that were collapsing?”

He concluded, “From where I sit, it has to do with the basic principles of banking, which… was not applied in the entire banking clean-up.”

Source: Abubakar Ibrahim

The decision, announced in court on July 22 by Deputy Attorney-General Dr. Justice Srem-Sai, follows what the AG’s office described as a “significant recovery” of state funds lost during the financial sector clean-up.

The case, The Republic v. Kwabena Duffuor & 7 Others (CR/0248/2020), was one of several prosecutions launched after the 2018 banking sector reforms aimed at sanitising Ghana’s financial system.

Dr. Duffuor, founder of uniBank and a former Governor of the Bank of Ghana, was charged in 2020 with offences including theft and money laundering. Prosecutors alleged that he unlawfully received GHS 663.3 million (about $122 million at the time) from the bank’s coffers.

uniBank was declared insolvent in August 2018 after the BoG found that shareholders and related parties had taken GHS 5.3 billion in loans and withdrawals without proper authorisation. The charges also involved other senior officials, including former BoG Deputy Governor Dr. Johnson Asiama.

According to the Deputy AG, the accused persons met a recovery threshold of 60% of the alleged losses following extensive negotiations involving the Economic and Organised Crime Office (EOCO) and other state agencies.

“In furtherance of the public interest, and considering the significant recoveries made for the State, the Attorney-General has satisfied himself that continuing with the prosecution will not serve any additional public purpose,” Dr. Srem-Sai stated.

A nolle prosequi does not amount to an acquittal but halts the prosecution, allowing room for future charges should new evidence emerge. The AG’s office emphasised that the move “does not imply an absence of wrongdoing” but reflects a pragmatic approach to safeguarding public resources.

The Attorney-General reaffirmed his commitment to accountability, transparency, and protecting the public purse in all matters of national importance.

Source: AdomOnline

According to him, it was a big blow, adding he and the family were greatly affected.

“It was a big blow and something that hurt me but I was lucky my family was supportive,” he said in an interview on Asempa FM’s Ekosii Sen.

The former Finance Minister and Governor of the Bank of Ghana indicated that although some of his businesses were affected by the revocation, others managed to survive.

The Bank of Ghana revoked the license of uniBank and five other banks to form the new Consolidated Bank Ghana in its bid to clean up the sector.

The Central Bank cited various reasons, including capital adequacy ratio crisis, poor corporate governance, and overexposure to related parties.

The bank shareholders, who are in court challenging the revocation of the licenses, recently petitioned Parliament on the matter.

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Parliament has since set up a committee chaired by First Deputy Speaker, Joseph Osei Owusu, to look into the petition and present a report to the House.