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Business News of Wednesday, 11 July 2018

Source: citinewsroom.com

BoG places limit on reappointment of Directors, CEOs of insolvent banks

Ernest Addison Bitcoin Dr. Ernest Addison, BoG Governor

Former managers of financial institutions who have been complicated in any act of insolvency or folding up of their companies risk not assuming any managerial role within the banking industry.

This is because the central bank is getting tougher with its rules governing the financial sector.

The latest guideline to be issued by the Bank of Ghana for the banking sector aside two others in less than a month, is the Fit and Proper Directive.

Amongst others the directive sets the framework which helps in determining whether a person is fit to be a director, a significant shareholder or to hold a key management position within the organization.

As a result, to be considered as a fit and proper person in the eyes of the BoG through its directive, one ought to demonstrate diligence, integrity as well as assure that the interests of depositors are not threatened.

Meanwhile, with the aspect bordering on reputation, the central bank pulls the break on those whose past work have affected the industry, as it says “it will require any nominee whether or not the person has held a position of responsibility in the management of a business that has gone into receivership, insolvency, or involuntary liquidation while the person was connected with that business.”

This is likely to impact managers or directors of defunct UT and Capital banks which have been absorbed by GCB Bank.

It is however unclear how it will impact on uniBank which is currently under the management of KPMG.