Republic Bank is facing some displeasure from the board of HFC Bank in Ghana.
According to HFC Bank, Trinidad and Tobago’s biggest indigenous financial institution has, in its “quest to take over the institution”, adopted a process “against what was agreed upon” since Republic became the major shareholder.
The board’s position was contained in a statement issued and signed by HFC’s company secretary, Beatrix Ama Amoah, quoted in a report from Ghanaian news outlet myjoyonline.com.
HFC said its statement is in reaction to Republic Bank’s statements last month it had been granted approval by the Bank of Ghana which came as a surprise, myjoyonline.com reported.
Last year, Republic acquired 40 per cent of HFC. By Ghanaian law any acquisition over 30 per cent triggers a requirement for the major shareholder to make a mandatory offer for the rest of the shares. The bank had requested a waiver from Ghana’s Security and Exchange Commission for the Code on Take Overs and Mergers, but was denied.
In April, Republic received approval from the Bank of Ghana to make the offer. If the offer is successful, it could lead to Republic Bank becoming the majority shareholder of HFC Bank and possibly take over the institution.
The board, myjoyonline.com reported, said that while it “recognises and appreciates the final decision on Republic Bank’s ambitions rest with the shareholders of HFC Bank”, the process adopted by Republic is “against the collaborative theme agreed earlier”, and it has sought legal advice (and will take appropriate steps to ensure) Republic complies with the applicable legal and regulatory requirements under the Ghanaian Law.
Republic, however, is denying breaching the process for (acquiring its stake in HFC), maintaining that all parties have been informed every stage of the acquisition.
Republic’s corporate secretary, Jacqueline Quamina, told the Express yesterday she understood the attachment the HFC’s management might have to the bank it had helped grow, but insisted Republic did not want its relationship with HFC to be anything like a hostile takeover.
“We prefer to work with the institution, the management, staff and customers because we believe they are very important components of a successful investment in a Bank. If one destroys any of those things, then one is destroying the company in which one is investing. We really want to work with HFC. (Republic has) good banking expertise, we are operators and we want to share this expertise with (HFC) and if we share it we can grow HFC into one of the leading banks in Ghana. We are very strong in mortgages (one of HFC’s strengths) as well but we have a different experience on which HFC will be able to build, and we can bring different elements of expertise like in credit cards and our experience in the energy sector. That is the attractiveness of the investment, HFC will benefit and Republic shareholders will also benefit,” she said. —Carla Bridglal