September 25, 2020

GN Bank wasn’t a ponzi scheme – Groupe Nduom replies Finance Minister

Groupe Nduom, owners of defunct GN Bank, has debunked claims that it operated as a ponzi scheme prior to being declared insolvent by the Bank of Ghana.

According to them, the Minister of Finance, Ken Ofori-Atta, while speaking in an interview on Accra-based, Asaase Radio on Sunday, July 26, stated that “When we got into office in January 2017, one of the documents that were called the Assets Quality Review of the banks showed most of these banks were literally bankrupt and therefore they were ‘ponzi schemes’ taking people’s money, loaning them to people and just regenerating them.”

But a statement issued by the management GN which is in court over the revocation of GN Savings and Loans license, noted that, “For the avoidance of doubt, GN Bank can never be said to be one of those banks referred to by the Minister,”

The statement also stated that, “GN Bank did not achieve 300 retail outlets and over one million customers by being a Ponzi scheme. It did not sprout up overnight. It did not benefit from government contracts or fund-raising schemes. Its license was not gifted to the shareholders or directors. The Bank was developed from hard work and sacrifice.”

It further explained that, the crisis in the financial system that hit it in August 2018 created a liquidity challenge.

“Prior to that, we were a very, highly liquid bank with a low non-performing loan portfolio. Our customers were happy with GN Bank,” it added.

Click here for the full statement:


It will be recalled that on August 16, 2019, the BoG revoked the specialised deposit-taking licences of over 20 savings and loans companies. This included GN Savings and Loans Company Limited.

The Central Bank said the revocation of the licences of these institutions had become necessary because they were insolvent even after they were given a reasonable period of time to recapitalize.

This was after the Bank of Ghana(BoG), downgraded the bank to a Savings and Loans company on Janauary, 2019.

However, on August 30, 2019, the shareholders of GN Savings filed a case at the High Court to challenge the BoG’s decision. The defendants in the case are the BoG, the Minister of Finance, the Attorney-General and the Receiver of GN Savings.

Also, on 17th April, 2020, the shareholders of GN Savings and Loans prayed the High Court to order the Bank of Ghana (BoG) to restore their specialized deposit-taking licence.


Source: Business