Bank of Ghana validating DKM Microfinance depositors for refund

Dr Abdul-Nashiru Issahaku - Governor of the Bank of Ghana
Dr Abdul-Nashiru Issahaku – Governor of the Bank of Ghana

The Bank of Ghana says repayment of customers of DKM Diamond Microfinance would commence soon after it has finished establishing the true financial position of DKM and the identities, deposits and accrued interests of its depositors.

The Governor of the Bank of Ghana, Dr Abdul-Nashiru Issahaku, said the necessary verification of the identities of the depositors and DKM Microfinance’s total assets, is ongoing.

“The registration of depositors has started – well over a month now – and is to go on to the end of June. Once that is established, payment can start,” he said.

According to the Governor, establishing the true values of DKM’s assets and liabilities was a challenge, so the Registrar General’s Department – the official liquidator of DKM Microfinance’s assets – commissioned PricewaterhouseCoopers (PwC) to undertake a forensic audit of the beleaguered microfinance company.

The forensic audit, also meant to validate depositors, their initial deposits and interests, found in its early stages that DKM had more assets than originally captured in a previous internal audit.

“It may well be that there are more assets than we think,” the Governor said.

Dr Issahaku disclosed that another resettlement option on the table being considered by the Bank of Ghana is a debt buyback by a commercial bank, whereby the central bank would approach an interested commercial bank to buy the debt at a discount and make advance payments once the audit results are in.

“If we go in directly as the central bank to make payments, there is the issue of moral hazard. So we need to think carefully. But one thing that is established is that effort is being made to pay depositors their original deposits and that would be done.”

“We’re also thinking around how quickly that can be done. So someone has to make the payments even as the liquidation process continues; because submitting the audit is just one step. We are now going to start selling and all that may take over a year. The poor farmer who just needs some two bags of fertilizer cannot wait a year,” he said.

DKM Diamond Microfinance Ltd flouted the Bank of Ghana’s regulations and ran an unsustainable high-interest Ponzi scheme. Deposits were diverted into subsidiary companies of the microfinance company, leaving its customers stranded when the company had its license revoked by the central bank.

By Emmanuel Odonkor

Copyright © 2016 by Creative Imaginations Publicity
All rights reserved. This news report or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the publisher except for the use of brief quotations in reviews.

Leave A Reply

Your email address will not be published.