GNCCI calls for better regulated banking sector

The Ghana National Chamber of Commerce and Industry (GNCCI) has charged the Bank of Ghana (BoG) to strengthen its supervisory and regulatory mechanism in order to build safe, sound, and stable banking sector in the country.

The statement issued by the Chief Executive Officer (CEO) of the GNCCI, Mr Mark Badu-Aboagye, in a statement issued on August 7 in Accra, said that the chamber welcomed the steps taken by the BoG to consolidate the five distressed banks into one entity - Consolidated Bank Ghana Limited.

“The central bank on August 1, 2018 announced the revocation of licences of five banks, including uniBank Ghana Limited, Sovereign Bank Limited, Construction Bank Limited, Beige Bank Limited, and The Royal Bank Limited.”

The chamber applauded the BoG for taking such a bold and decisive initiative to prevent what would potentially have been a major crisis in the financial sector of the country’s economy, of which the private sector would have been a major victim.

Financial support

“While the chamber encourages the establishment of indigenous banks to play a major role in the financial sector of the country’s economy, it would like to recommend strongly that interested Ghanaian investors in the banking industry should team-up their resources, both financial and human capital, to establish strong and profitable banks to withstand the vagaries of the highly competitive banking industry.”

It said these initiatives taken by the BoG to ensure a safe, sound and stable banking sector were critical and timely to maintain confidence in the financial sector and to ensure that the private sector credit growth was unimpeded.

“Businesses need credit to expand to be able to create more and better jobs.

“Any disruption in the banking sector affects the majority of businesses and individuals who rely on banks for their credit and investment needs,” it added.

Chamber’s expectations

The statement said, “the chamber expects that the current restructuring of the banking sector and the financial system would contribute to strengthen the real economy.

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According to the statement, there should be a concerted effort to ensure that growth in the banking sector was commensurate with growth in the real economy, including agriculture and industry.

“Officials from the BoG and the affected banks whose actions and inaction have resulted in this dire situation must be investigated and brought to book where necessary.

Continuous inspection and enforcement by the BoG is critical in ensuring financial stability,” it said.