President Nana Akufo-Addo has said contrary to claims that his government is deliberately killing local banks, the Bank of Ghana is rather making sure that the banking sector is strengthened.
The government has, since August 2017, rescued seven struggling local banks with GHS8billion of taxpayers’ money.
The seven banks include UT Bank, Capital Bank, uniBank, Sovereign Bank, The Royal Bank, The Beige Bank and The Construction Bank.
The first two went under in August 2017.
The other five went bust two weeks shy of a year after the first two failed.
UT Bank and Capital Bank were taken over by GCB Bank while the last five were put together by the Bank of Ghana to form the all-new Consolidated Bank Ghana Limited.
Addressing the Ghanaian community in Kigali, as part of his state visit to Rwanda at the invitation of President Paul Kagame to participate in the African Green Revolution Forum (AGRF) being held under the theme: ‘Lead, Measure, Grow: Enabling new pathways to turn smallholders into sustainable agribusinesses’, the Ghanaian leader said: “There has been some controversy in Ghana over, for instance, the situation in the banking sector and you’ve heard about it.
“The decision that the central bank has taken which has affected seven important indigenous banks who were being supported by the taxpayer through the Bank of Ghana.
“Altogether, the indebtedness of these seven banks amount to some GHS8billion that the Bank of Ghana used to support these banks.
“That’s not – I’m sure – medium- or long-term solution that we can support; that the bank of Ghana will be taking taxpayers money to support inefficient, poorly managed bank.
“So, the bank of Ghana stepped in and the regulatory measures that it has taken are those that have resulted in the takeover/dissolution of these banks.”
In the president’s view: “We are trying to make sure that the banking sector of the country has strong indigenous banks which can compete successfully with foreign own banks.
“It’s not a question of: we are going through a process in order to eliminate the indigenous banks from the banking system of our country; that’s very dangerous, it won’t make sense to do that at all.
“On the contrary, the process of rationalisation is to enable us to emerge with the strongest set of indigenous banks who can then help grow our economy,” he stated.
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