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Former Employees Of Savings & Loans Firms To Receive Outstanding Salaries

Former employees of the resolved Microfinance and Savings and Loans as well as finance house companies are to be paid their outstanding salaries, negotiated and agreed exit packages.

In accordance with Section 123 of Act 930, Bank of Ghana appointed Eric Nana Nipah as receiver for the purposes of winding down the affairs of 347 Microfinance Companies as well as 23 savings and loans and finance house companies whose licenses were revoked on May 31, 2019 and August 16, 2019, respectively.

In a statement, the receiver says in the coming week beginning from Monday July 13, 2020, there will be an engagement with the authorized representatives of the ex-staff to agree on modalities for the payment of outstanding salaries and exit packages to ex-staff of these resolved institutions.

It says in line with the hierarchy of creditor claims set out under Act 930, other creditors of the failed institutions will be settled by the Receiver upon validation of their claims and to the extent that the Receiver is able to realize value from the remaining assets of these institutions.

However, the receiver says while tracing stashed capital of the defunct entities it has approached the Bank of Ghana for a bail out to settle the affected workers.

“Accordingly, the Receiver is compelled to undertake a detailed assets tracing and forensics exercise in collaboration with the Economic and Organised Crime Organisation (EOCO) to locate and recover these assets. The consequence in pursuing this recovery route is that creditor claims including employee related claims in the resolution of the affected MFCs and S&Ls are not likely to be settled any time soon.

“To ameliorate the economic impact of the resolution exercise on former employees of these affected companies particularly in these times of COVID, Bank of Ghana has agreed to pre-finance the full settlement of employee related claims which otherwise rank as Unsecured claims in the receiverships of these companies”, statement noted