An Accra High Court has dismissed an application by the Bank of Ghana (BoG) asking the court to dismiss UniCredit’s application challenging the revocation of the company’s license.
Owners of UniCredit were before the court seeking a judicial review of the decision of the Bank of Ghana to revoke its license in an August 2019 exercise.
The plaintiff (UniCredit) wants the court to quash the Bank of Ghana’s revocation of its license and declaring it insolvent, by effect causing the institution to cease operation.
But before that case could be heard, the BoG through its lawyers filed an application asking the court to strike out the application.
According to the BoG, the applicant (UniCredit) did not properly invoke the jurisdiction of the court.
It further argued that the process should have begun through an arbitration process and not the court.
But the Judge, Justice George Koomson in his ruling said the applicants had properly invoked the jurisdiction of the court and that the case of breach of natural justice is one that the court has the mandate to hear.
A cost of GHc3000 was subsequently awarded against the BoG.
The mother company of UniCredit Savings and Loans Company – Hoda Holdings Limited in August 2019 sued Dr Ernest Addison and the Bank of Ghana for revoking the license of the company.
In the company’s affidavit filed at the Human Rights Division of the High Court, Hoda Holdings said its funds of over GHS54 million were locked up with Unibank before it was forced to cease operations by the central bank in 2018 and it has since been trying to retrieve it.
The BoG report stated UniCredit’s adjusted capital adequacy ratio of negative that breaches the statutory cash reserve ratio requirement since April 2018, while also it was unable to meet the deposit withdrawals of customers due to its severe liquidity challenges.
The BoG received many complaints from the institution’s customers about their inability to access their funds and the institution had a high percentage of non-performing loans,” BoG’s report remarked.7.83% as of the end of May 2019 was in violation of Section 29(2) of Act 930.