Politicians to blame for collapse of savings and loan companies – Dalex Finance CEO
Chief Executive Officer of Dalex Finance, Ken Thompson has expressed shock at the attitude of industry players and politicians following the revocation of the licenses of some savings and loan companies not in good standing per the standards of the Central Bank.
Read full articleHe disclosed to Citi FM’s Bernard Avle that he was not surprised at the turn of events as politicians were essentially spending big using the monies of depositors; some to fund their projects.
“…I’m surprised that people are surprised that we are where we are because all these things that the Bank of Ghana are talking about have been the subject of tabletop gossip for the last five or six years.
We went through a period of just madness. People were spending…the cars, the flights, everybody having board meetings in Dubai, we saw the people building estates. We saw the buildings. It wasn’t a problem so long as government had money to spend. As soon as the money stopped, the music stopped… People were spending. Where do we think all that money came from? It was depositor’s funds” Mr Thompson explained
He maintained that industry watchers would be telling lies if they claimed they did not know what was going as it was glaring for all to see.
The Dalex Finance CEO further alleged that some political parties took 70 percent of loans from the institutions.
“… there’s nobody who is in the industry who can tell me they didn’t know this wasn’t going on, there’s absolutely nobody. There are some institutions where 70 percent of their loans are given to related parties, their friends…” he stressed
Ken Thompson, however, admitted that the magnitude of the collapse was too great.
Background
Bank of Ghana on Friday 16th August announced a batch of the country’s savings and loan companies which were insolvent, resulting in the revocation of their licenses.
The exercise forms part of the Central Bank’s initiative to rid the country of unhealthy finance institutions to acquire a stable financial sector and subsequently the economy.
Twenty-three savings and loan companies had their licenses revoked.
Below is the statement from the Bank of Ghana
