Exclusive: Abu Dhabi investor seeks to exit Mongolia bank after governance row | Reuters

Exclusive: Abu Dhabi investor seeks to exit Mongolia bank after governance row | Reuters:



"A foreign investor has moved to sever ties with Mongolia's largest private lender, Golomt Bank, because of its concerns over the lender's weak corporate governance standards, according to documents and a source familiar with the matter.



The Abu Dhabi Investment Council (ADIC), which lent Golomt $25 million in 2010, is seeking to call in the loan after a turbulent 15 months inside the bank, in which auditors identified serious management failings, according to the source and an external audit report reviewed by Reuters.



ADIC and Golomt are currently in dispute over whether the sovereign investor can redeem its five-year loan before maturity and the matter has gone to confidential arbitration proceedings in London, the source said, declining to give details.



ADIC's accusations of mismanagement inside Golomt, which holds a quarter of Mongolia's deposits, underline wider concerns voiced by credit rating agencies and the World Bank in recent months about poor corporate governance among the nation's banks."



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