Collapsed financial institutions: Minority demands accountability

The Minority in Parliament is demanding greater accountability and transparency in the supervision, management and regulation of the financial institutions that were collapsed in the banking sector clean-up exercise.

It has also asked the government to unveil who the true owners of the Consolidated Bank of Ghana (CBG) were since the government dedicated GH¢450 million of the 2018 sovereign bond to financial sector bailout.

“We are demanding who are the owners of the CBG because public money was invested with this bank and we are also demanding whether this money is equity or a loan,” it said.

Collapsed banks

Addressing the press outside Parliament on Monday, the Minority Leader, Mr Haruna Iddrisu, said “We are demanding this greater accountability and transparency from the government, and in particular from the President and more specifically the Bank of Ghana, the regulator,” he said.

A total of eight universal banks, 23 savings and loans companies, as well as over 400 microfinance institutions were collapsed when the central bank revoked their licenses for being insolvent.

The Bank of Ghana merged five banks into the CBG. They are BEIGE, Sovereign, Construction, UniBank and Royal Bank.

Publish inventory

The minority leader said per the Banks and Specialised Deposits-Taking Institutions Act 2016, Act 930 Section 130 (1), a “receiver shall establish a new financial position for the bank or specialised taking position based a on determination of liquidations values of the assets of the bank or specialised taking-deposit institution.

He said section 134 of the act emphasised that the receiver shall within one month of taking possession of a bank or specialised deposit-taking institution transmit a copy of the inventory report to the Bank of Ghana.

He, therefore, quizzed the whereabouts of the inventory reports on the collapsed banks and on the microfinance and savings institutions.

“Was it remitted to the Bank of Ghana? If yes, where is it and we demand respect to the latter and spirit of the Specialised Deposit-Taking Institutions 2016, Act 930,” he asked.
Mr Iddrisu said per Section 130(5) of the act, the central bank was required to publish the inventory report in two national daily newspapers and on the website of the Bank of Ghana.

“This has not happened and this is a breach of the law and we are demanding greater accountability and transparency from the governor and the Bank of Ghana as a regulator of the financial sector.

Reaping

The Tamale South legislator added that the receiver, under the contract, was entitled to five per cent recovered from the auction of the assets of the collapsed institutions.

“It would interest Ghanaians to know probably the receiver may have earned more than he should and the numbers would excite them to know how much money the state has spent on the receiver in the name of the banks that they could not salvage or rescue when they needed state support and intervention the most,” he said.—#GhanaVotes2020#