The Bank of Ghana (BoG) is to introduce a new set of rules to regulate the foreign exchange market in the country, Governor of BoG, Dr. Kofi Wampah, has stated.
He said the objective of the new regulations was to bring sanity in the financial market sector as well as address the shortages of foreign currencies which occurred in the foreign exchange market.
Speaking at the launch of the Financial Markets Association (ACI-Ghana) in Accra on Thursday, the Governor said the rules would become effective January 2014 after which the BoG would issue license to all the banks in the country to carry out foreign exchange business in January 2015.
The ACI-Ghana, formed twenty years ago, was formerly known as Dealers Club with the mandate of the members to, among other things, secure capital for their various companies.
Expatiating further on the new regulations, Dr Wampah said the final draft regulation would be completed by the end of December, and among the key characteristics would be the annual licensing of all banks to carry out foreign exchange business in the country.
“Currently we have submitted the draft regulations to the managing directors of the various banks to go through and submit their suggestions,’’ he stated.
He explained that the existing banks would not be required to apply for license to transact foreign exchange business when the new rules become effective in January 2014, saying the BoG would issue license to all the existing banks.
“However, after 2014, all the existing banks will have to annually apply for the foreign exchange market license beginning from January 2015 to transact foreign exchange business,’’ Dr Wampah stated.
He said the qualifying criteria for the foreign exchange dealership license shall be made available to all the banks, adding that to apply for renewal of the foreign exchange license, banks ought to do so three months before the expiry date of their licence.
“As part of the rules, the BoG will introduce a bid offer spread on all foreign exchange transactions executed on behalf of corporate bodies or at the interbank counter parties,’’ Dr. Wampah stated.
That, he said, was to ensure that banks do not take advantage of shortages in the market and to make unreasonable profits from their customers.
Dr. Wampah pledged that the BoG would support the association to thrive because the financial market contributed to the development of the foreign exchange market in the country.
Mr. Othniel Kwainoo, President of ACI in his address entreated the banks to ensure good corporate governance and compliance with the foreign exchange and said Ghana needed an effective financial market to promote the development of the country.
The President said the financial crisis which occurred in other developed economies was as a result of the disregard of ethics by the players in the financial market and called for effective risk regulatory measures to safeguard the country’s financial market.
Mr. Kwainoo encouraged all the members of the association to support the executives to build a thriving and vibrant association.
As part of the programme , a four-member executive was inaugurated to man the association for the next two years and a new logo for the association was launched.
The four-member executive has Mr Othniel Kwainoo as President, Gloria Augustt Walace as Vice President, Jacob Brobbey, Treasurer, Adwoa Addo, Secretary and Samuel Nii Okine, Organising Secretary.
Source: The Ghanaian Times
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