Former President John Mahama has said he will restore banking licenses of banks whose licenses were revoked due to their inability to meet the Bank of Ghana’s (BoG) GHS 400m capital requirement.
According to the former president, his government will have an unbiased look at the circumstances under which banks were collapsed during the banking sector clean-up in 2017 and if it is determined that their licenses were unjustifiably revoked, his government will be willing to return to the banks their licenses.
The government in 2017 undertook the banking sector clean-up under the supervision of the Finance Minister, Ken Ofori-Atta.
The exercise saw a reduction in the number of banks from 34 to 23, whilst 347 microfinance institutions, 15 savings and loans, and eight finance houses had their licenses revoked.
The total estimated cost of the state’s fiscal intervention amounted to GHS 25bn.
“One of the reasons why the banks were collapsed during the banking sector clean-up is because of their inability to meet the GHS 400m capital requirement.
“I know some of these banks are currently in court and we will wait till the cases are adjudicated and when that is done, my government will then have an unbiased look at the circumstances under which their licenses were revoked.
“And when we find out that their licenses were unjustifiably revoked, my government will be willing to restore their licenses so they can continue to work,” he posited.
Speaking further, Mr Mahama quipped his government will introduce a tiered banking system where banks are required to have different capitalization requirements.
According to the former president, the big banks will maintain the GHS 400m capital requirement, whereas mid-size and small banks will have capital requirements of GHS 200m and GHS 80 to 100m respectively.
“Banks cater to different businesses with some being big and others small and in different sectors of the economy and so I don’t believe in all banks having the same capital requirement (sic).
“So will have a tiered banking system where the big banks will have a capital requirement of GHS 400m to cater to the big businesses, then mid-size banks with GHS 200m for the medium-sized businesses and then small banks with GHS 80 – 100m capital requirement to cater for the SMEs (sic),” he noted.
Norvanreports