Merge to raise GHC400m minimum Capital - BoG tells banks

The Bank of Ghana (BoG) has said it is open to mergers and acquisitions between banks so that they can achieve the revised minimum capital of GHS400million which takes effect in December 2018.

The central bank announced the increase in minimum capital requirement for all existing universal banks including those applying to become universal banks.

The minimum capital was increased from GHS120million to GHS400million.

This should mean that any bank that has not met the new minimum capital by December 2018 could lose its licence to operate in the country.

Speaking at the maiden edition of the Ghana SME CEOs summit in Accra on Monday, 20 November 2017, the First Deputy Governor of the Bank of Ghana, Dr Maxwell Opoku encouraged banks to merge to be able to meet the requirement so as to avert the situation where their licences are revoked.

He said: “While we expect all banks to be able to meet this new minimum capital, we’re also opened to possible mergers and acquisition with the ultimate objective of having well-capitalised and strong banks,” adding that: “Strong and well-capitalised banks are expected to operate efficiently by reducing their overhead cost which should translate into lowering the cost of credit particularly to SMEs that are able to present bankable projects.”

Dr Opoku further disclosed that going forward, the Bank of Ghana remains committed to promoting financial sector reforms aimed at deepening the financial system and removing deficiencies that inhibit access to credits especially to SMEs.