There is poor risk management in Ghana’s banking sector – Dr. Atuahene

A banking consultant, Dr. Richmond Atuahene, has associated Ghana’s banking sector crisis with poor risk management and poor corporate governance.

According to him, banks in Ghana do not duly assess the impact and risks involved in certain decisions they make. This is what according to him, has led to the crisis and losses that have characterized the sector’s operations in the past few years.

In an exclusive interview with GhanaWeb’s Mawuli Ahorlumegah on BizTech, he said some banks engaged in practices that contained huge risks but were a cheaper way of making money.

He said: “There is poor risk management in the banking sector. Because if you have customer deposits and you decide to invest far more exceedingly above the loans. One bank [name withheld], its total bonds were 9.2 billion as against its loan portfolio of 7.2 billion. Because we saw it was a cheaper way of making money but the risk involved is that nobody goes for higher returns and looks at the risks involved.

“Unfortunately, I will state this categorically, there was poor risk management from the banks and a corporate governance failure because if the corporate governance was very good like some of the foreign banks they saw it and decided to trade off, sell it, and go into something else,” he said.

Dr. Atuahene emphasized that: “That is why I am saying that what costs us is poor corporate governance and poor risk management.”

SSD/MA

Watch the latest edition of BizTech below:



Ghana’s leading digital news platform, GhanaWeb, in conjunction with the Korle-Bu Teaching Hospital, is embarking on an aggressive campaign which is geared towards ensuring that parliament passes comprehensive legislation to guide organ harvesting, organ donation, and organ transplantation in the country.