The Bank of Ghana (BoG) has justified its decision to revoke the license of GN Savings and Loans.
The Director of Communications
at the Bank of Ghana Bernard Otabil provided the justification while dismissing
claims by the Chairman of Group Nduom, Dr Papa Kwasi Nduom that the central
bank was influenced by former Finance Minister Ken Ofori-Atta to collapse the
GN Savings and Loans.
Mr Otabil stated that GN Saving
and Loans violated the financial regulations including the Foreign
Exchange Act of 2006 (Act 723).
“At the end of the day,
it is not in the interest of the central bank or we don’t go out there and say
this institution must actually be closed down at all cost. It depends on
how the institution is run, it depends on what the institution itself has
stated that it wants to do and on respecting the prudential norms. In fact, let
me make it clear that the GN Bank and GN Savings and Loans were actually
disrespectful to the central bank.
“For instance, if you go through
the books you will see that there was a transfer of dollars, and pounds and
Euros to International Business Solutions which is an institution affiliated to
the group network based outside which was in direct breach of the Foreign
Exchange Act of 2006 (Act 723). These provisions are there. Our statement of
August 16 2019, we stand by that statement and in that statement, we have given
all the reasons behind the revocation of the license of GN Savings and loans,”
he told TV3’s Paa Kwasi Asare.
In 2019, the Bank of Ghana revoked the licenses of 23 savings and
loans companies and finance house companies, which included the GN Bank. The
bank subsequently sought legal action challenging the revocation of GN Savings
and Loans’ license by the Bank of Ghana.
But in January of this year, an
Accra High Court presided over by Justice Gifty Addo Adjei upheld the legality
of the Central Bank’s decision, emphasizing the institution’s right to revoke
the license due to governance deficiencies that rendered GN Savings and Loans
unable to meet its debt obligations.
Dr Nduiom had stated that Mr
Ofori-Atta petitioned Cabinet to facilitate the collapse of GN Bank to prevent
any political interference.
“I have with me here a memorandum submitted by the Minister of Finance at that
time, Mr. Ken Ofori-Atta, asking Cabinet to agree for GN Bank to be
collapsed, for its license to be taken. This memorandum didn’t consider that
this bank was the biggest bank with the widest distribution in Ghana.
“It didn’t recognize that we
were providing banking services that increased financial inclusion in Ghana. It
didn’t recognize that we were supporting financial development and economic
development in Ghana.
“It just said, these people are
causing us problems and therefore it might affect our political chances, so
let’s shut it down,” Dr. Paa Kwesi Nduom claimed in a viral video shared on X
formerly Twitter.
He acknowledged that, although the memorandum was presented to the cabinet, the
cabinet did not consent to Ken Ofori-Atta‘s request to revoke the bank’s
operating license.
Meanwhile
Dr. Nduom has filed for an appeal against the judgement given by Justice Gifty
Addo.
Source:
3news