Ghana ‘s government will pay customers of the country’s collapsed banks, microfinance firms 100% of their deposits. President Nana Akufo-Addo said customers of the collapsed banks in the banking sector cleanup exercise will receive a full payment for their locked up cash. This will also be the case for customers of the collapse microfinance and savings and loans companies as well.

“Thus far, the Ministry of Finance and the Bank of Ghana have worked together to guarantee payments of 100% of deposits of customers of the failed banks which is being done. I have directed the Ministry of Finance to work with the Bank of Ghana to ensure that same applies to customers of microfinance and Savings and Loans Companies whose licenses have been revoked,” he said.

Here Is All You Need To Know

• While stressing that the decision to clean up the financial sector was necessary, Akufo-Addo said the jobs of some 6,500 Ghanaians were saved as a result.
• According to him, some GHS 4.6 million of depositors’ funds were also safeguarded due to the process.
• Read also:Ghana ’s Govt. Doles Out $2.8 billion To Pay Depositors of Collapsed Financial Institutions

“We have had to take painful but necessary measures to sanitize and save the banking system. A process which I know has brought discomfort to many a household. It is worthy to note however that the jobs of some 6500 workers were saved as a result instead of the 10,000 that could have been lost. In addition to the protection of funds of 4.6 million depositors.

• He further stated that the government will soon make public, investigations into the circumstances that led to the collapse of some indigenous banks in the country.
• According to him, preliminary investigations reveal that huge assets of the collapsed banks were diverted.
• He said persons found culpable for the collapse of the financial institutions will be duly dealt with.
• Read also:Ghanaian Central Bank Introduces New Bank Notes Next Week

“Investigations into potential criminal conduct are proceeding. As it appears, there has been a massive diversion of assets of these financial institutions. I assure you that the outcome of these inquiries will be made known very soon as well as actions taken to bring those responsible to book,” the President promised.

• The financial sector clean-up, commenced by the Akufo-Addo administration in August 2017, has led to the collapse of nine universal banks, 347 microfinance companies, 39 microcredit companies or money lenders, 15 savings and loans companies, eight finance house companies, and two non-bank financial institutions.

Read also:Ghanaians Lose Their Savings As Bank of Ghana Revokes 23 Business Licenses

Banking sector reforms

In August 2017, the Bank of Ghana (BoG) gave GCB Bank Ltd the green light to acquire two local banks UT and Capital bank due to severe impairment of their capital.

In August 2018, the Bank of Ghana consolidated five other local banks into what it calls the Consolidated Bank Ghana Limited.

The Bank of Ghana in a statement on January 4, 2019, following the expiration of the minimum capital requirement deadline, said all the 23 remaining banks have met the new minimum paid-up capital of GHC400 million.

347 microfinance companies also had their licenses revoked by the Bank of Ghana in May 2019.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world