Ghanaian farmers and fishermen have endorsed the decision of the agricultural development bank (adb) to offload shares on the Ghana Stock Exchange (GSE) through an Initial Public Offering (IPO).
According to the farmers and fishermen, by listing on the GSE, the bank would raise more capital to support the growth and development of the country’s agric and aquaculture sectors.
They have, in a stakeholder consultation with the bank in Accra on Monday, nudged the state-owned financial firm to go ahead with its intended IPO that is geared towards raising some GH¢300 million to fund growth and revamp the operations of the bank to make it competitive.
The consultation meeting is the second in a series aimed at soliciting the farmers and fishermen’s ideas on the bank’s IPO, which was suspended by the government for further consultations.
The President of the National Farmers and Fishermen Award Winners Association (NFFAWAG), Philip Abayori, who chaired the day’s consultation meeting with the management of adb, farmers, and fishermen, insisted that “going to the stock will make adb solid to finance agric” in the country.
“We, the farmers and fishermen of Ghana, therefore, solidly support the bank’s decision to go to the GSE to raise more funds for agriculture,” he stated emphatically at the meeting in Accra yesterday.
“We think this bank needs to be strengthened. We have come to consensus that we have to support the bank to be able to achieve its aim,” Mr. Abayori said.
“We hope that management would do their best to ensure that all the difficulties or bottlenecks, and all that needed to be done, are done to make sure this IPO process goes through smoothly,” he added.
The Secretary of the Ghana Tomatoes Federation, Patrick Kwame Ahiabu, said the decision by the bank to list on the market was a laudable idea, and urged all to support the move.
“This is a laudable idea. It is an opportunity some of us have been yearning for, for a very long time, so that we can also own a part of the bank. You need to speed up the process,” he told adb management.
The farmers and fishermen have, in the past, expressed concern about their inability to access the needed funding from the bank to boost their business, but after the bank explained to them that the adb had always supported agriculture and agribusiness, with at least 32 percent of the bank’s loan portfolio being held by the sector, the challenge was raising enough money to meet their expectations.
The Managing Director of the adb, Stephen Kpordzih, who with other top management staff engaged the farmers and fishermen on the bank’s readiness to float shares on the stock market, said with the current ownership structure as state-owned, the bank is unable to access medium
and long-term funds that exist elsewhere, for example, from financial institutions like the IFC, CDC among others.
“They do have lines of credit for agriculture and small and medium scale enterprises. You can access between five to 15 year lines, but they will not deal with a hundred percent state-owned organisation. They like to deal with a private sector.”
Mr. Kpordzih told the farmers and fishermen that the bank, in going forward, will commit resources to agriculture, because about 60 percent of the Ghanaian populace are in agriculture business, cautioning those in the sector “to see agriculture as a serious business rather than the usual subsistence farming.”
“We need to find a way by getting people to understand that with proper funding made available, we can finance agriculture and make it profitable.”
The MD urged the farmers and fishermen to buy into the intended IPO, so as to give them the necessary leverage in the workings of the bank.
The farmers were pushing for a 20 percent stake in the bank, but Mr. Kpordzih said this was subject to approval by the shareholders.
Cabinet3 last year, gave approval for adb to list on the Ghana Stock Exchange through the IPO. Adb, which is 50 years this year, was set up in 1965 by Act 286. It is wholly publicly-owned.
The Government of Ghana owns 52% of the shareholding, with the remaining 48% held by the Financial Investment Trust, on behalf of the Bank of Ghana.
The Central Bank has often been criticised for owning part of an entity it regulates — a situation that critics, among them the International Monetary Fund, say creates a conflict of interest situation, and fuels perceptions of favouritism.
African Eye News.com
