Gov’t defends Shake-Up in the Banking Sector

Government has refuted claims that the merger of the five banks into the Consolidated bank Ghana Ltd(CBG), was politically motivated.

Speaking at a Press Conference in Accra, Information Minister-designate, Kojo Oppong Nkrumah, noted the clean-up in the financial sector has become necessary due to the distress in the sector.

“There are some who seek to reduce everything in this country to Partisan politics, in the recent weeks am sure you have heard some political actors claiming that the clean up is ill driven, or it an attempt to collapse the banking system, this is blatant, ill-informed, it is rather the time to soberly reflect and come to terms with the nature of the challenge and the efforts that the new administration is putting in place to overcome the challenge.

“Indeed if we want to partisan with it, then the current administration will be the one with the highest moral ground and question members the previous administration of what they did to have allowed the situation deteriorate further, but our focus is to deliver change in the financial sector,” he stressed.

He added government was dedicated to building a strong financial sector and strong Indigenous banks

According to him, “this is rather the time to tone down and soberly reflect and come to terms with the nature of the challenge and the efforts that the new administration is making to resolve it.”

BoG on Wednesday, August 1, 2018, collapsed five banks and merged them into what the BoG called ‘Consolidated Bank Ghana Limited. The five banks, include Beige, Royal, Sovereign Bank, uniBank and the Construction Bank.

According to the Bank of Ghana, the reason for the merger includes liquidity challenges, the inability of the said banks to meet the Ghc400 million minimum Capital requirement, and the fact that some of these banks obtained their licenses under false pretenses and with nonexistent capital.