Dr. Johnson Asiama speaking
Dr. Johnson Asiama, Second Deputy Governor of the Bank of Ghana (BoG), has called on the banking sector to adopt sound corporate governance practices in order to provide the needed impetus for continuous growth.
He said sound governance practices remain the only toolkit that can guarantee continued corporate existence in this era of rapid globalization, which is characterized by technological advancements, liberalization of markets, product and customer sophistication.
Dr. Asiama made this known at the Ghana Corporate Governance programme organized by the International Finance Corporation (IFC) and Bank of Ghana (BoG) in Accra yesterday.
He said, “No amount of regulatory and supervisory interventions can fully institutionalize corporate governance in banks unless boards and senior management of banks appreciate the value of sound corporate governance practices to their productivity and competitiveness.
Dr. Asiama said banks need sound corporate governance practices in order to build public trust and confidence, as well as credibility in their operations so as to promote the safety and soundness of the entire banking system.
“Failure to employ sound governance practices can easily erode public trust and further threaten the existence of their institutions,” he said.
In contemporary banking, Dr. Asiama said sound corporate governance is particularly important, as the rapid changes brought about by globalization, deregulation and technological advances are increasing the risks in banking.
“Moreover, unlike other companies and institutions, most of the funds used by banks to conduct their business belong to their creditors, in particular their depositors.
“Linked to this is the fact that the failure of a bank affects not only its own stakeholders, but also may have an adverse systemic impact on the stability of other banks, as well as the economy as a whole,” he said.
The Deputy Governor of the BoG said his outfit would continue to evolve guidelines and regulations that will safeguard the interest of all stakeholders.
By Cephas Larbi
cephrok@yahoo.com