Stop Panic Withdrawals- BOG urges Public

The Bank of Ghana (BOG) has urged the general public to desist from panic withdrawals.

The BOG in recent times has been criticized by several financial stakeholders including Chairman of Groupe Nduom, Papa Kwasi Nduom for failing to educate the public on recent reforms it is undertaking to clean up the banking sector, leading to panic withdrawals from stakeholders in the banking sector.

The BOG for some years now has engaged in exercises including the revocation of the license of some banks it said were facing liquidity challenges, to strengthen the banking sector.

This action by the BOG has caused severe panic as some customers of several banks harbour fear of losing their funds.

Special Advisor to the Governor of the Bank of Ghana, Ben Amoah, speaking to Citi Business News at a training workshop for members of the Journalist for Business Advocacy said the banking sector is still sturdy and the public should refrain from panic withdrawals.

“Don’t panic to put undue pressure on them. When you need the money, go there, they have money for you, but if you don’t need the money don’t go and queue with people and withdraw your money. If we all do that, no bank can survive in the world.”

On meeting the minimum capital requirement of Ghc400 million, Mr. Amoah reiterated the central bank’s position, saying banks that will not be able to raise the said figure would have to merge or secure a lower license.

“Banks are allowed to merge and raise funds on their own and capitalize their surplus to meet the requirement,” he stated.

He disclosed however that banks that have not met the requirement yet have submitted the recapitalization program that they are implementing which he believes will be successful.

All commercial banks operating in the country have up to December 31 to capitalize to the tune of GHc400 million.

His comments come after seven indigenous banks collapsed within a space of 12 months.

All the banks ran into one liquidity challenge or the other although the BoG has clarified that some of the banks shouldn’t have existed at all.

Sovereign Bank, for instance, was cited to have obtained its license under false pretences; using non-existent capital.

That has caused public mistrust in the local banks while the BoG insists that it is working to clean up the sector. It has created The Consolidated Bank Ghana to take over the five banks which collapsed in 2018 while the assets and liabilities of Capital Bank and UT Bank which collapsed in 2017 are now owned by state-owned GCB.