We the staff of Merchant Bank have been listening with keen interest and concern to media reports that the staff of Merchant Bank are unhappy about the Merchant Bank and First Rand Bank transaction.

We wish to state our true position on this matter as staff of the Bank.

1. We are fully aware of the challenges the Bank has been grappling with regarding its non performing loan book over the last few years and the untiring efforts Management, staff and the Board of Directors have put in place to address same. These issues with the non-performing loans have led to a dire need for recapitalisation if the bank is to regain its pride of place.

2. Following painstaking processes embarked upon by the Bank and its shareholders which include staff of the Bank acting through the Trustees of our Permanent Staff Provident Fund, an agreement was reached to welcome the participation of First Rand as a strategic investor. After reviewing the facts and figures behind the name First Rand and the dynamics of the transaction, we are fully convinced that our shareholders took the right decision in approving the transaction. 

3. We wish to bring the following to the attention of readers

a. First Rand is the second largest Bank in South Africa with assets in excess of USD 103 Billion recording profits of over 2.8 billion USD as at the end of 2011(Annual report of First Rand). To put this in perspective, the total assets of the Banking industry in Ghana according to the Bank of Ghana (MPC report for June) was Ghc 23 billion as at April 2012(about 13 billion USD). The group has over one hundred years of banking history in South Africa.

b. Rand Merchant Bank, the investment Banking, subsidiary of First Rand Group has a portfolio of investments around the world including Ghana. First Rand has already invested over USD 580 Million in various development projects in Ghana across various sectors including the recent Ghana Cocoa Board syndication, the transport sector, energy and Oil sector, Telecommunications sector, construction, just to mention a few. The total portfolio size could rise to over USD 1 billion in the next few months.

c. We the staff are aware that the Bank in addition to its operations in 6 countries in Southern Africa, London, Dubai, Australia and India, is extending its expansion drive into the West African sub region. Currently they have a representative office in Nigeria and are hoping to open up full Banking operations there soon. Due to the good macroeconomic and investment climate, they settled on investing in Ghana as a priority destination and in Merchant Bank for that matter. 

d. First Rand is participating in this transaction by an agreed injection of cash of Ghc 176.4 million into Merchant Bank. It is our hope and conviction that we will be able to leverage this cash injection to support the economy of Ghana.

e. First Rand is a financial services group with world class Bank management and risk management expertise and, bringing along those skills to Merchant Bank will go a long way to improve the risk management profile of the Bank and turn around the fortunes of the Bank in the next few years.

f. First Rand has a track record in all the countries in which they have invested in Banks including Botswana, Mozambique and Malawi. They have always turned around the Banks they invest in and made them hugely profitable.

g. First Rand has already developed exceptional capabilities in their systems, products, markets, segments and management philosophy which we can only leverage.

4. In the light of the foregoing, we, the staff of Merchant Bank are:

a. Fully aware and convinced that the First Rand deal is going to help turn the investment of our existing shareholders into profitable investments that will inure to the benefit of the of pension fund contributors;

b. Fully convinced that the agreements on the treatment of the non-performing loans of the Bank in the transaction are the right and most creative ones that will preserve this Bank; we believe that these non-performing loans are still recoverable.

c. Unoblivious of the fact that that the injection of the much needed capitalisation in the form of cash injection will help better position the bank with the kind of strong balance sheet required to support the many emerging economic opportunities in Ghana. 

d. deeply concerned that the jobs of the close to a thousand employees who depend on the Bank either as full time employees or outsourced employees need to be preserved.

5. We wish to affirm as staff of the bank as follows;

a. Any report anywhere that seeks to suggest that the staff of Merchant Bank are not happy with the First Rand deal is false, without merit and calculated to throw dust into the eyes of the general public and should be ignored. Indeed the unnecessary debate and media attention, most of which are unfounded and without basis is causing anxiety and panic not only to the staff of the Bank but to our loyal and cherished customers and must stop.

b. We condemn and reject any attempt to toy with the fortunes of the bank and its staff and all must take note! 

Signed Staff of Merchant Bank
(This communiqué bears physical signatures of over 350 permanent staff of the bank)