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Banks sue University of Ghana over Unpaid Loans for Hostels

Banks sue University of Ghana over Unpaid Loans for Hostels

Six banks have threatened to sue the management of the University of Ghana (UG), Legon for failing to pay a loan facility the university took to construct hostels.

CAL Bank, Agricultural Development Bank, Ecobank, Fidelity Bank, International Commercial Bank and Societé Generale Bank, Ghana, are demanding the payment of the GH¢50 million they gave to the university authorities for the construction of hostel facilities.

The amount represents the banks’ contribution to the overall cost of the project, which includes infrastructure, services and furnishing.

The banks have vowed to go to court in order to take over 12,500 beds in the hostels due to the delay in the payment of the amount.

The Managing Director of CAL Bank, Mr Frank Adu Jnr., who made this known to the Daily Graphic in an interview, said the banks had decided to resort to court action owing to the delay in the payment of the loan.

He was speaking on the sidelines of the bank’s Facts behind the Figures presentation at the premises of the Ghana Stock Exchange in Accra last Tuesday.

“The government in 2012 pledged to take over the payment of the loan, but as of now we are yet to see that materialise into actual payment so we have decided to go to court,” Mr Adu said.

When asked why the banks were demanding to take over 12,500 beds although their share of the project amounted to only 7,000 beds, Mr Adu explained that the “the banks built 7,000 beds but the agreement guaranteed us 12,500 beds as security and we are willing to push for that.”

Agreement

As part of efforts to solve the accommodation problems confronting students, the University of Ghana, through the University of Ghana Enterprise Limited (UGEL) in 2007, entered into an agreement with the six banks to build hostel facilities to meet the accommodation demands.

Under the agreement, the syndicate, led by the CAL bank, provided GH¢26 million for the project which was meant to accommodate 7,000 students, while the university provided GH¢4.2 million.

The agreement led to the construction of four new halls of residence.

These are the Hilla Limann; Alex Kwapong, Elizabeth Sey and the Jean Nelson Halls.

Source: Daily Graphic

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About Ellis Ferdinand

Ellis Ferdinand is the Founder/Chief Executive Officer of EducationGhana Limited and the Managing Editor at EducationGhana.net . He is a passionate writer,a publicist and an online Marketer and Promoter. He is Ghana's number 1 Education Blogger who brings all happenings in the Ghanaian Education Sector ,from Basic to Tertiary, to the doorsteps of readers on EducationGhana.net He is also the Founder of Education Awards Ghana which will soon be launched in Ghana to help boosts the Education Sector. He is Passionate about Promoting Education in Ghana, Africa and the world at large. Ferdinand Completed Accra College of Education and was Awarded a Diploma In Basic Education by the University of Cape Coast and Currently reading Psychology and Foundation of Education with Management and Accounting Options at the University of Cape Coast in Ghana. Ferdinand is willing to work with any organization who believes in Promoting quality business as well as Education in Ghana and Africa. You can Contact him for Promotion of Events,Advertisements,Publications and any other business through Education Ghana.

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