Governor of the Bank of Ghana, BOG, Dr. Ernest Addison has reiterated the Central Bank's commitment to promoting strong, viable and stable banks to support the country's growth and development process.
In line with the commitment by the BOG, Dr. Ernest Addison said the BOG will engage with stakeholders as they design specific measures to strengthen systems and processes that would improve the financial sector.
"The outlook for the financial sector is positive and BOG remains committed to promoting strong, viable and stable banks, SDIs, RCBs, and MFIs to support the country’s growth and development process. In the months ahead, we will engage with stakeholders as we design specific measures to strengthen systems and processes that would improve the industry."
In a press conference attended by Prime News on March 20, 2018, Dr. Ernest Addison outlined some plans to be undertaken by the BOG to make the financial sector in Ghana stable.
Approach to the plan comes in two forms; BOG Roadmap to Streamline the Banking Sector and 2018 forward – Improving the Supervisory and Regulatory Environment.
For the BOG Roadmap to Streamline the Banking Sector BOG Governor said: "as you would realize by now, poor banking practices, coupled with weak supervision and regulation by the Bank of Ghana has significantly undermined the stability of the banking and other non-bank financial institutions and we all know some of the consequences by now—revocation of licenses of two banks while other banks were placed under comprehensive capital restoration plans. 8. The financial sector cleanup has started but not completed and we have managed to keep a few weak banks in operation since August 2017."
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Improving the Supervisory and Regulatory Environment will focus on restoring safety, soundness, and stability in the financial sector by strengthening regulatory and supervisory framework and promote confidence in the financial system through among other things:
"Introduce the Basel Regulatory Capital Requirement Directive, review of guidelines, directives, and regulations to the industry in line with the new Banks and Specialized Deposit-taking Institutions Act, 2016 (Act 930), roll-out of the Basel II/III supervisory framework, and ensure implementation of IFRS 9 by banks; full implementation of the new minimum capital requirements for banks by end December 2018 deadline. To this end, the BOG will issue guidelines to the industry on compliance with the capital increase directive of 2017 and strictly monitor compliance; Address specific risks from high NPLs, poor corporate governance and poor risk management systems. To this end, we will issue directives on corporate governance, risk management (including cyber and information security-related risks);"
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