Board of foreign owned banks must not be rubber stamp to offshore decisions – Governor

Dr. Johnson Asiama, Governor of the Bank of Ghana, has urged Ghana-based boards of foreign banks not to serve as rubber stamps for instructions issued from offshore.

The Governor expressed growing concern over the outsourcing of major credit and risk decisions to offshore locations, which are not subject to Ghana’s regulatory oversight.

He raised this concern during a meeting with Chief Executive Officers of banks, stating that such outsourcing “undermines the very basis of effective governance and creates unacceptable regulatory blind spots.”

Dr. Asiama emphasised that local boards and management teams must retain genuine authority over all material credit decisions and risk management actions taken in Ghana.

Prior approval from the Bank of Ghana will now be required before any delegation of key decision-making functions to foreign entities.

The Governor warned that boards endorsing decisions made without proper local deliberation would be in breach of the Corporate Governance Directive (Sections 9 & 13) and could face regulatory sanctions.

“Institutions found bypassing local governance structures may also be subject to fitness and propriety reviews, particularly where directors are seen to be abdicating their fiduciary duties.”

“This principle is reinforced by the BoG Outsourcing Directive, which takes effect on 1st July 2025. Institutions are reminded to review all outsourcing arrangements – including those involving data, credit assessment, and management control to ensure they meet our supervisory expectations for accountability and due diligence,” he said. 

He further stressed that legal and data protection obligations could be breached when sensitive customer data sent offshore without consent, in violation of the Data Protection Act (Act 843) and the BoG Cybersecurity Directive.

The Governor also noted that outsourcing such services undermined domestic institutional capacity as local professionals were disempowered and denied the experience needed to develop leadership qualities.

Dr. Asiama reassured foreign-owned banks that the directive was not anti-foreign but “pro-accountability.”

He added,” It is about ensuring that all banks operating in Ghana, regardless of ownership, are governed in ways that reflect the interests of this market, its regulators, and its people.”

Source: GNA

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