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Friday, July 10, 2020

GN Savings and Loans in talks with another bank to meet it’s Financial Obligations

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GN Savings and Loans, previously GN Bank, says it is finalizing talks with another bank to possibly help it meet its financial obligations.

The move is part of some emergency measures to help deal with current liquidity challenges facing the Savings and Loans Company.

Details of the deal

GN has received applications from eight commercial banks that are seeking to act as “partner institution”.

GN Savings and Loans is finalizing negotiations with one of them with an announcement expected in the coming days.

This would help GN depend on this bank for clearing of its Cheques and Forex transactions since it is expected to lose that function from the middle of this year.

Following the reclassification of GN Bank now GN Savings and Loans, Bank of Ghana the institution can no longer carry out that function.

It is expected to close that operation and service by the middle of this year.

The negotiations are being structured in a way that could help improve GN Savings and Loans’ liquidity. This is expected to help GN honour deposit withdrawals in the coming weeks.

GN Savings and Loans problems

GN Savings and Loans over the previous months had struggled to honour deposit withdrawals.  Some of them really turned nasty, with some of their customers pitching camp at their banking halls, until their deposits are paid to them.

The institution had earlier requested the Bank of Ghana to approve its reclassification into a savings and loans, which was done January this year.

GN Savings and Loans had maintained that the move would have little impact on its operations going forward.

This is because its core operations would be greatly affected; only that it would be restricted when it comes to cheque clearing and holding Forex accounts and transactions.

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