From left: Father Andrew Campbell, President Akufo-Addo, Dr Ernest Addison, an official of the bank and Finance Minister Ken Ofori-Atta push a button to inaugurate the new office of Standard Chartered Bank
President Akufo-Addo has reiterated that officials of the seven failed banks and the Bank of Ghana (BoG) who would be found culpable in the collapse of the financial institutions would be dealt with severely.
Speaking at the inauguration of a new head office of Standard Chartered Bank off the Independence Avenue in Accra yesterday, he emphasized that “I have said it before and let me reiterate that those responsible for the sequence of activities that led to the crisis in quote will face the full brunt of the law if they are found to have broken the law, and suffer all the consequences prescribed by law.”
He said there were situations whereby directors of banks took the monies of depositors and lenders, invested them in their own businesses and failed to pay back, adding that these led to liquidity challenges and the inability of the banks to pay depositors who demanded their funds.
According to him, the said banks became insolvent and relied on liquidity support from the Bank of Ghana.
“What this meant was that without injection of liquidity from the Bank of Ghana, they were bound to fail and collapse, with depositors losing their entire savings and all their workers losing their jobs.
“A responsible governor and a responsible regulator, Bank of Ghana had to intervene to ensure we never had a banking crisis. And that is exactly what happened.”
President Akufo-Addo further explained that GH¢12.7 billion of public funds made up of GH¢8 billion bond issued by the Ministry of Finance with GH¢4.7 billion of liquidity support from the Central Bank were injected into the seven banks that failed.
GCB Bank took over the affairs of Capital Bank and UT Bank, and a new state-owned bank, the Ghana Consolidated Bank, was created out of the five other failed banks, i.e. Sovereign Bank, uniBank, Construction Bank, Royal Bank and Beige Bank.
“These measures saved not only the deposits of 1,147,336 Ghanaians and their businesses and the people they employ, but also minimized job losses in the banking sector.
“The rationalisation and clean-up of the financial sector were necessary to safeguard the health and strength of the economy.”
Commenting on the mobile money system, he said currently mobile money transactions were worth GH¢158.8 billion up from GH¢78.5 billion in December 2016, representing an increase of 25.5 percent.
“We are moving our cash payments system from predominantly a cash-based one to an electronic one.”
He commended Dr Emmanuel Oteng Kumah and Mansa Nettey, the board chair and Chief Executive Officer (CEO) of Standard Chartered Bank respectively, as well as management and staff of the bank for working hard to bring the bank to its state.
Bill Winters, Group CEO, Standard Chartered Plc, commented: “Our investment in Ghana is another important strategic step to enable access to a pool of highly-skilled talent who can support our ambitions to be an employer of choice. Ghana is a strategically important market for us, and we are committed to building a sustainable business, attracting the best talent and expertise to support our clients’ business growth.”
By Samuel Boadi