Golomt Bank is today responding to certain inaccurate allegations made in recent press articles relating to its corporate governance and its business.
Golomt Bank is currently involved in a legal dispute with Stanhope Investments, which centers around a disagreement on the wording of a loan agreement. The loan in question is for US$25 million, which represents approximately 1% of the bank’s entire assets and therefore, is not material to the overall financial health of the Bank. The Bank is confident that the dispute will be resolved swiftly and amicably.
However, misleading and false allegations have been made in recent press articles, which the Bank feels it needs to address.
It has incorrectly been suggested that investors, including Credit Suisse, are attempting to recover funds invested in the Bank. In the case of Credit Suisse, a convertible loan for US$10million has expired and was fully paid off. Golomt Bank currently has no obligation with Credit Suisse, whether in the form of loans or otherwise.
Golomt Bank does not have any shareholders seeking repayment of loans, these are equity investments in our bank and none of our investors have signaled any intent to leave the bank. The allegations about Trafigura and Swiss-Mo are ungrounded and have no merits.
Other allegations have also been made against the Bank in relation to previous financial transactions with Itochu Corp. These are historic issues that have all now been fully resolved and, due to client confidentiality, we cannot comment further.We can confirm that Golomt bank has no financial obligations related to these transactions.
Furthermore, Golomt Bank has no other financial obligations to any other foreign entities except the US$25 million loan referred to above. The reference in certain media articles to US$90 million is entirely incorrect.
Much has also been made of delays in issuing Golomt Bank’s 2012 audited financial results. Golomt’s 2012 financial results were originally delayed when the auditors brought to light certain historical governance issues. There then ensued a protracted period of independent investigation, reflecting the Board and the management’s full commitment to the continued improvements in our internal controls and overall governance. We have issued our financial reports for 2012 and BDO, one of the world’s largest and reputable international accounting firms, completed an audit.
The Bank is continuing to engage with PWC, who originally led the independent investigation, to further improve our accounting and internal control procedures and the necessary improvements to our internal governance processes have now been made.
Golomt Bank is a key institution in the Mongolian banking sector and continues to enjoy positive and profitable relationships with its international investors. As evidenced by our unaudited 2013 results published on our website, the Bank is profitable and continues to perform well.
The Bank’s organizational structure is in the process of modernization, including separating the duties and roles of different business units and control functions. Golomt Bank will continue to strengthen its leadership as well as working with international consultancy firms to further improve its corporate governance.
Through our investment in new technology and software solutions which are unprecedented in the Mongolian banking sector, the Bank will continue to build on existing improvements by upgrading internal control systems while enhancing transparency, accountability and regulatory compliance.
G.Ganbold, CEO, Golomt Bank Mongolia said: “In 2013, Golomt Bank celebrated stable growth over the past 19 years and we are excited about new opportunities, working with international partners and adopting new technology. Changes on the Board are allowing us to better pursue our strategy of becoming a public company which is at the epicenter of the growing Mongolian economy. The management team remains absolutely confident in our operational performance and the current dispute will have no bearing on Golomt’s integral position in the Mongolian banking sector. The Board is committed to adopting further international governance practices and looks forward to receiving a report currently being prepared by an independent third party that builds on the improvements that have already been implemented.”
About Golomt Bank:
Golomt bank was founded in 1995 and is one of the oldest and largest ‘home grown’ banks in Mongolian banking sector since the democratic revolution took place in Mongolia in 1990. It is one of the leading commercial banks in Mongolia with over 100 branches, 1700 employees and well established domestic and international client bases in both corporate and retail sectors.
- GOLOMT BANK OF MONGOLIA -
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