President Akufo-Addo has for the first time since news of Ghana’s banking crisis broke revealed why his administration took a tough stance to sanitize the sector.
At an engagement with Ghanaians living in Rwanda on Thursday, the President explained that “Ghana cannot have a situation where dominant banks in the country are all foreign banks because it would be suicidal for the country’s future”.
He further said a single local bank, which was “much stronger” and could complement the role being played by GCB was preferable than seven inefficient poorly managed ones which would make no meaningful impact on the lives of Ghanaians.
President Akufo-Addo said the ongoing rationalization of the banking sector by the Bank of Ghana (BoG) is to enable the country emerge with the strongest set of indigenous banks to help grow Ghana’s economy.
According to the President, “This process is being undertaken so that at the end of the process, even if they are few, and they are strong, we know that they can compete successfully with the foreign owned banks; it is very important for me.”
The President debunked the assertions by some that ongoing rationalization is meant to eliminate the indigenous banking sector from the country’s banking system, stressing “that’s very dangerous; it won’t make sense to do that at all.”
“The Central Bank supported seven indigenous banks to the tune of GH¢8 billion and it’s a short, medium or long-term solution that we cannot support, especially as these banks had proven themselves to be inefficient and poorly managed”.
Thus, the new state-owned bank, i.e. the Consolidated Bank of Ghana, the President said, is going to be a much stronger indigenous bank, alongside GCB Bank and therefore provide leadership in the indigenous banking sector that is required.