Banks must embrace financial sector reforms - Deputy Governor

Accra, July 29, GNA - Mr Millison Narh, the Deputy Governor, Bank of Ghana, on Thursday asked banking institutions to embrace the financial sector reform processes that were underway to safeguard the financial system.

He said as custodians of the financial architecture, the banks must recommit themselves to the core tenets of effective and sound risk management practices and be proactive in the supervisory oversight responsibilities to maintain confidence and trust in the financial system.

Mr Narh was speaking at the opening session of a two-day International Banking Forum in Accra.

Ghana Commercial Bank is playing host in collaboration with Bank of China and Stanbic Bank and representatives from Ghana, United States, Nigeria, Kenya, Mauritius and Uganda.

The forum is the third being organised by Bankers Association for Finance and Trade (BAFT) and International Financial Services Association (IFSA) in cooperation with the BAFT-IFAS Africa Council.

It would deal with issues relating to the effective development of industry-wide business solutions in the Africa region and strengthen collaboration and cooperation with other regional councils in Asia, Europe, the United States and Latin America.

Issues to be discussed would include sustaining value creation in the financial services industry through the application of appropriate risk modelling practices, liquidity crisis and drivers in trade finance that spark growth.

Others are inter-regional trade flows, anti-money laundering and combating financial terrorism, challenges and opportunities of mobile payments and major initiatives for transaction banking.

Mr Narh said although reforms were necessary, they must be backed by effective supervisory oversight to build strong financial institutions.

To strengthen the resilience of individual banking institutions as well as to reduce systemic risks, the Bank of Ghana has adopted the International Financial Reporting Standards in line with international standards.

Besides, the establishment of collateral registry, credit reference bureaus also seeks to promote transparency and ease of credit accessibility.

Mr Narh said a Financial Intelligence Centre had been set up to address money laundering and counter financing for terrorism.

He said the intermediary roles played by financial institutions were critical to the economic growth process and therefore the reform process was seeking to provide adequate buffers in the financial sector to limit the impact of shocks on the real sectors of the economy.

A speech read on behalf of the Minister of Finance and Economic Planning, Dr Kwabena Duffuor, said Ghana's financial sector was aimed at establishing a strong regulatory and supervisory framework to guide the operations of financial institutions.

This, he said, had facilitated the development of banking sector that was reasonably efficient, financially innovative, competitive and profitable.