Toxic banking and my dreams of yesteryear

When I left university about a quarter of a century ago, I was confronted with the dilemma of what career to pursue. Initially I thought of the Foreign Service, and then the thought fizzled out due to a couple of practical realities.

Then the United Nations floated by. Other lofty and worthy professional ideas also came by, like banking, marketing, journalism and translations.

But somehow, they were like passing winds, and they never quite anchored themselves in my young, blank yet fertile mind.

Last week’s announcement by the Bank of Ghana of the consolidation of five banks brought memories of my flirtations with the banking profession a quarter of a century ago.

I think it was the smooth corporate image of conservative suits and ties and cool, soothing banking halls, together with the notion of handling vast, eye-popping amounts of money, whether physically, on paper or at the touch of a computer keyboard that initially attracted me to the profession.

But my non-conformist mind also found the compulsory daily ‘uniform’ of conservative suits and ties a bit too restrictive and the cool, silent banking halls a tad staid for my liking.

As for handling other people’s big amounts of money, I think I would have found that rather depressing, especially if I only had coins in my account. And I do have a particular aversion towards figures and graphs, which of course are unavoidable in the profession. I love to tease my banker friends over something I read a while ago, that a banker is a person who lends you an umbrella during the dry season and demands it back during the rainy season. They tell me I am just jealous. Well, maybe they are right.

Causes and effects?

I took the time and the trouble to absorb, through banker friends, social media and traditional media precisely what had happened that led to the consolidation of five banks by the Bank of Ghana, what it meant to the banks’ customers, to the affected banks themselves and ultimately to the Ghanaian taxpayer.

Lawyer Ace Ankomah made an interesting Facebook post on the subject that went viral.

He stated “there was a time when to rob a bank, you had to find a gun and a face mask. Today, you just set up your own bank and then rob it.”

I think two important, familiar elements came together in this instance to create the chaos that led to Bank of Ghana’s decision: greed and poor enforcement.

I tend to veer towards the view that inherently, man is cruel, greedy and selfish, and to that extent, I stand with the seventeenth century English philosopher Thomas Hobbes, who in 1651 wrote in his work Leviathan that life in a state of nature is ‘solitary, poor, nasty, brutish and short’.

From the biblical perspective, man is said to be clothed in ‘original sin’ from birth, arising from Adam’s consumption of the forbidden fruit in the Garden of Eden.

Our society of today, that seems to glorify wealth and power, however obtained, seems to feed into an inordinate desire by some to achieve either or both by any means necessary in order to acquire societal respect.

From this, it emerges, with some elegant clarity, that to control our base instincts, it is necessary to have laws that regulate our behaviour for the common good. And the laws must not only exist but must bite with the ferocity of a Rottweiler, lest we slide into anarchy.

It is said that in this country we have all the beautiful laws that we need, but that our bane is the enforcement of the law.

When people see the law merely as suggestions, they tend to be more brazen in breaking it. Of course, even in countries where the law is enforced to the letter, people still engage in the risk of breaking it, but a law that roars and bites is far better than one that purrs and then rolls over to sleep.

It is outrageous that per the Bank of Ghana, some basic regulations and requirements were dispensed with in the application for banking licence and false pretence was perpetrated in some instances in obtaining these licences.

There are allegations of ignoring credit risk assessment guidelines and others, including weak corporate governance compliance.

In all of this, the Bank of Ghana has had to commit over GHS450m to capitalise the new bank it has created out of the dissolved banks, the Consolidated Bank Ghana Ltd, to save the situation and protect depositors, together with other measures.

I can only dream of what the public money being pumped into all of this could do for the Free Senior High School programme, the National Health Insurance system, roads and many other sectors of the economy.

Playing tough and looking within

The Governor of the Bank of Ghana, Dr Ernest Addison, comes across as a tough headmaster of a mission school, and I have no doubt that he will clean up the system. I think it would be interesting to see some people exchange their expensive suits for drab prison garb, as they no doubt would in certain countries in similar circumstances.

In all of this, however, the Governor must also shine a bright light into the dark recesses of his outfit.

Who negligently allowed himself (or herself) to dribbled into issuing provisional banking licences applied for under false pretences, and how did the system miss these for full licences to be issued? Or was there collusion at some level? Whichever way, I think heads must roll, to borrow a phrase that gained prominence in Ghanaian political parlance not too long ago.

In the past week, I have often wondered what would have become of me, had I pursued banking as a career.

Maybe I would have risen to become a hard-nosed Governor of the Central Bank, cutting swathes through the system and giving corporate vagabonds sleepless nights.

Or perhaps I would have been a senior banker with one of the affected banks, guilty of many infractions but smoking a fat cigar and relaxing over a cold beer, safe in the knowledge that this storm shall blow over and nothing will happen, as usual.

But as a crooked banker, maybe I would be shaking with fear whilst waiting for the dreaded invitation by EOCO, followed by a full-blown trial and wondering whether I would go to Nsawam, Akuse or Ho Prison.

But I am sure I would have been a diligent senior banking executive, lending umbrellas during the dry season with a cheerful smile, demanding them back in the rainy season and protecting depositors’ money with the zeal of a fresh convert on an evangelising mission.

I think I can safely bank on that.