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Business News of Sunday, 5 August 2018

Source: Myjoyonline.com

Banks closure: BoG Governor absolved Central Bank from neglect of duty – Adom-Otchere

The host of Good Evening Ghana has called out the Governor of the Bank of Ghana (BoG) for absolving the Central Bank from the mess some banks found themselves in leading to their closure.

Paul Adom-Otchere said there was an obvious dereliction of duty by Dr Ernest Addison which led to the closure of five banks forcing the creation of Consolidated Ghana Bank Limited.

The Board member of National Communication Authority (NCA) said he was worried that the Governor failed in his role to protect public when it comes to where they bank their monies and other valuables.

According to Mr Adom-Otchere, Dr Addison at his press conference to announce the closure of the banks, “brilliantly expressed what he wants to do [as BoG Governor] and seems to be protecting the public in the way he presented himself.”

“However, he did not discuss a major question about the whole episode -- the dereliction of duty of BoG itself,” he told Samson Lardy Anyenini on Joy FM/MultiTV's news analysis programme Newsfile, Saturday.

According to him, leaving the Central Bank out of what happened leaves the country in a dangerous position since the citizenry “does not know whether this will recur another time.”

The Central Bank has been criticised by financial analysts for its lax on playing it supervisory role which has led to the closure of five banks.

This week, the country’s banking took another turbulent turn as five banks folded up and metamorphised into one bank – the Consolidated Bank Ghana Limited.

Sovereign Bank, Construction Bank, Beige Bank, unibank and Royal Bank all went under for various reasons, the Central Bank explained.

Three of the banks, BoG said used false pretense to obtain their banking licenses while two others were beyond saving.

On August 14, 2017, Capital Bank and UT Bank also suffered similar fate and BoG did not hesitate to close them down. GCB Bank inherited all the two banks’ assets and liabilities.



Five Managing Directors of the dissolved banks: L-R: Stephen Kpordzih (Construction Bank) Osei Asafo - Adjei (Royal Bank) Dr Duffuor II (uniBank), Johan Rheeder (Sovereign Bank) , Mike Nyinaku (Beige Bank)

But Mr Adom-Otchere is not impressed with Dr Addison for his inability to “tell us these things happened because of the BoG’s supervisory jurisdiction or the people that implement that were derelict in their duty so certain measures have been put in place to forestall it happening again.”

He said the Bank Act 930 – Banks Specialised Deposit Taking Act of 2016 – who have the responsibility to implement the Act must understand the relationship they have with the public and deal with it accordingly.

"I insist that the Governor and his people must come out and apologise to Ghanaians for what had happened..." he said.



But the Second Deputy Governor, Dr Elsie Awadzie disagreed saying due process was followed and the Central Bank did not sleep on their job.

"It is unfortunate that people thing BoG did something unlawful...that is not the case, the Central Bank will not take such a difficult decision without due regard to the law," she responded.