All customers of collapsed financial companies to receive cash today

All customers of the collapsed micro finance, savings and loans companies will effective Wednesday, September 16, 2020 receive cash instead of the earlier promised government backed bonds.

This follows the decision to convert all the government backed non-interest bearing commercial paper (bonds) into cash at no discount in respect of the payments to affected depositors of the collapsed companies.

It will be recalled that the government had provided a combination of cash and bonds to pay depositors of the collapsed financial institutions, being 347 microfinance and 23 savings and loans companies.

The Receiver, Eric Nana Nipah made the new arrangement of cash payment to all customers known in a press statement issued Tuesday evening, [September 15, 2020].

The payment takes effect Wednesday, September 16, 2020 and will be paid by the Consolidated Bank of Ghana (CBG).

The new arrangement affects only depositors of the 347 microfinance companies and 23 savings and loans whose claims have been validated in the resolution process.

In the Receiver's statement, a copy of which is with Graphic Online, Mr Eric Nana Nipah explained that the decision had become necessary due to concerns raised by affected depositors in relation to the bonds.

"The Depositor Payment Scheme set up by the Receiver/Official Liquidator to administer and fully settle all valid depositor claims in the resolution process has largely been successful; however an area of concern for most of the affected depositors is with the features of the Commercial Paper [Bond] used to partially settle the indebtedness of these resolved companies to those depositors whose claims were not fully extinguished by the payment of cash to them."

"These depositors have indicated that the features of the Bond, being non-interest bearing and with a tenor of five years do not make the Bond commercially attractive, thus creating a significant loss in value of their claims to them."


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