GhPageNewsKen Ofori-Atta took ¢5M from me to save his business but failed...

Ken Ofori-Atta took ¢5M from me to save his business but failed to pay on time – Kofi Amoabeng reveals 

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Prince Kofi Amoabeng, the co-founder of the defunct UT Bank, claims he once bailed out Finance Minister Ken Ofori-Atta when his business ran into financial difficulties.

In his book “the UT story: Humble Beginnings,” Kofi Amoabeng recounted how Ken Ofori-Atta approached him for a loan of $5 million to keep his business afloat.

He revealed in his book that he felt obligated to give the money to Ken despite the fact that it was above the Single Obligor Limit at the time because of their friendship.

UT was a non-bank financial service company that was causing havoc in Ghana’s financial sector with its superfast loans and debt recovery strategy at the time.

Kofi Amoabeng then sought permission from his board members, who were vehemently opposed to the loan being granted.

According to Kofi Amoabeng’s book, despite stiff opposition from his board members, he “literally stood surety for their application,” and the board reluctantly granted the application.

However, things did not turn out as he had hoped.

“Ken and his partner, Keli Gadzekpo, came to me bearing their shares in Enterprise Insurance as collateral for a loan of about ¢5 million.

 

“At the time, the cedi had undergone redenomination and had been rebranded as ‘new Ghana cedi’. The ¢5 million he requested, therefore, was equivalent to about $5 million,” he said.

 

“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.

 

“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 said.

 

“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,” he said.

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