Minority - We Would Have Saved Banks With Our Reform Agenda

By Julius Yao Petetsi

IF the government, through the Bank of Ghana (BoG), had followed "the reform agenda" started by the former National Democratic Congress (NDC) government, the nine collapsed banks and the dozens of financial institutions would not have gone down the radar, the Minority caucus in Parliament has argued.

In the view of the caucus, the NDC administration's reform agenda was built around carefully crafted interrelated pillars to produce solid, well capitalised and globally compli-ant competitive banking sector.

At a press conference addressed by the Member of Parliament (MP) for Bolgatanga Central, Isaac Adongo, in Accra yesterday, the opposition

lawmakers said the roadmap included conduct of an independent asset quality review

by the PriceWaterhouse Coopers ( PWC) in 2015, reform of legal framework for banking sector regulation.

Apart from the above, Mr Adongo said BoG under the announced comprehensive recapitalisation and cleanup programme based on two pillars, a minimum capital requirement of GH¢230 million and a guideline for cleaning up balance sheet of banks through risk-based model.

Two banks, UT and Capital, were the first to be closed down by BoG in 2017 and its

assets and liabilities transferred to GCB Bank before seven others - Biege, Royal, Construction, Sovereign, Heritage, GN and Unibank - were consolidated into wholly state-owned Consolidated Bank in 2018.

Since then, 347 microfinance companies, 39 micro credit companies, 15 loans and

savings companies, eight finance house companies and two non-bank financial institutions, have been shut down.

But Mr Adongo, who is also Member of Parliament's Finance Committee said "the NDC government's banking

sector reform strategy would have been seamless, less disruptive, increase confidence [in the banking sector] and produce strong banks that are compliant with international standards and best practice.

"We would have saved all the collapsed banks and financial institutions and averted the needless panic withdrawals that have hit the Ghanaian financial sector.

"The caucus realises no reason behind using GH?23 billion to collapse the banks when fraction could have been used to save the banks and its accompanying jobs.

"The Ghanaian tax payer would have been spared high cost of this chaotic reform if BoG had listened and followed reform programme initiated by NDC," Mr Adongo said.

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