How it took Ofori-Atta four years to repay GH¢5 million UT bank loan – Amoabeng recounts

He was not named Finance Minister at the time

Prince Amoabeng writes book on the UT bank story

It is important to note that Ken Ofori-Atta was not named Finance Minister as at the time events contained in the book ensued

Ghanaian business mogul, Prince Kofi Amoabeng, has shared details of how it took four years for the current Minister of Finance, Ken Ofori-Atta to repay a loan from his defunct UT bank.

According to a JoyNews report sharing excerpts of the ordeal contained in a book written by the UT Bank co-founder dubbed; “The UT story: Humble Beginnings,” he said Ken Ofori-Atta requested for the loan of GH¢5 million to sustain his business which was in dire financial assistance at the time.

“Ken and his partner, Keli Gadzekpo, came to me bearing their shares in Enterprise Insurance as collateral for a loan of about GH¢5 million. At the time, the cedi had undergone redenomination and had been rebranded as ‘new Ghana cedi’. The GH¢5 million he requested, therefore, was equivalent to about US$5 million,” he said.

Despite the loan being above the Single Obligor Limit at the time of its request, the UT bank boss shared that he felt obliged to grant Ofori-Atta’s request due to their friendship.

“We were very good friends so I felt obliged, albeit not without conducting the necessary due diligence. It was curious though that they did not prefer the banks where they would have secured the loan at a much lower annual interest rate as compared to our significantly higher monthly compounded interest rates,” Amoabeng said.

“Be that as it may after I perused their documents. I felt it was acceptable to grant the loan. The only snag, and a significant one at that, was that the amount exceeded the Single Obligor Limit. Ideally, I should have declined their request there and then. Instead, I decided to bail them out,” he shared.

The UT bank boss also said that though majority of his board members strongly opposed to Ken Ofori-Atta’s request, he decided to assist a friend in need.

He literally stood surety for their application and the board reluctantly granted the application.”

But after the loan application was approved, Prince Amoabeng said things did not go as planned as discussed as Ken Ofori-Atta failed to honour his end of the bargain.

“Unfortunately, Ken failed to honour his end of the bargain. He defaulted badly on the repayment schedule. The situation was so bad that they could only service the interest on the loan,” he revealed.

“I became concerned because I had assured the board, I knew Ken very well and I was convinced beyond doubt that he would honour his word. Thus, I had egg on my face, especially as my partner had expressly stated his disapproval of the request,” excerpts of the books read.

While the default on the loan re-payment started to be of concern, the UT bank co-founder said he had to defend Ken Ofori-Atta on numerous occasions, to his board members.

“I called a meeting with Ken and Keli and admonished them to do their best to pay up. I made it clear to them that I did not want my men to hassle them. Sefa Asante was the Credit Officer in charge of that portfolio. Because of my relationship with Ken and the respect I had for him, I prohibited Sefa and his team from applying our usual, rigid recovery methods.”

“In fact, I gave him express instructions not to ever hassle Ken and his team. They could check on them every now and then, but they had to be discreet about it. If they felt they were being stonewalled, they should not push back or react. Rather, they should revert to me on how to handle the situation,” he continued.

Prince Kofi Amoabeng added that, “Furthermore, to be double sure that Ken and Keli were not hassled, I devised a clever plan and informed them about it. Anytime the board exerted pressure on me, I invited them to a meeting, documented the meeting, and formally informed the board about it. It was all a ruse to hold the board at bay and buy Ken and Keli more time to pay up.”

The UT boss recounted that despite an extended grace period to Ofori-Atta to repay the said loan, it took him over four years to pay up his debt to the now-defunct UT bank.

“When the issue lingered, I reduced the interest rate to about 3% a month, just so they could settle their debt. Unfortunately, it took them over four years to pay up. Even then, they serviced it in bits and pieces until they were able to eventually pay up,” he revealed.

UT Bank, prior to insolvency was a non-bank financial service company offering superfast loans to individuals, businesses among others.