The Director of
Communications of the Bank of Ghana (BoG) has clarified that the BoG worked
closely with GN Bank during its liquidity challenges.
According to him, the
Central Bank also worked with GN Bank after its request to be reclassified as a
Savings and Loans company.
He indicated that the
revocation of GN Savings and Loans’ license was based on sound judgment to
protect the sanctity of the banking sector.
“We tried to take our
time with the case of GN Bank. When depositors started shouting all over the
country because the Savings and Loans company could not meet depositors
withdrawals it was time to act,” Mr Otabil said.
Adding “Aside from the
reported cases in the media, the Financial Stability Department of the Bank of
Ghana received complaints of the company’s inability to pay their deposits on
demand. To ensure an orderly exit of the company and protect the sanctity of
the banking sector, the company’s license had to be withdrawn in accordance
with the provisions of the Banks and Specilised Deposit-Taking Institutions,
Act 2016 (Act 930)”.
Mr Otabil noted that the
BoG has provided details on the various infractions that led to the revocation
of the license of GN Savings and Loans Company.
GN Bank, unable to meet
the new minimum regulatory capital requirement of GHS400 million by the end of
31 December 2018 applied to the Bank of Ghana for a reclassification to a
Savings and Loans Company, a request which the Bank obliged.
However, the license of the Savings and Loans Company was
revoked in August 2019 when the Bank of Ghana realised that the company still
had liquidity challenges with customer agitations and complaints sent to the
Financial Stability Department.