All your monies will be paid this year – Bawumia to collapsed Savings & loans customers

Vice President Mahamudu Bawumia has reiterated government’s promise to pay customers of the collapsed Savings and Loans companies in full this year.

Speaking at the Townhall Meeting and Results Fair in Kumasi Tuesday Dr. Bawumia said the payment will be extended to victims of the DKM scandal.

“Employees whose salaries and employee benefits had been unpaid by the defunct institutions have been paid or are being paid by the receivers. Government has already spent over Ghc 13 billion paying depositors of banks and other financial institutions, and the President has given the assurance and I will like to repeat that no depositor of a bank, savings and loan or microfinance company would lose even a pesewa of their deposits.

“ALL depositors of these institutions will receive a 100% refund of their deposits since this was no fault of their own. Government has asked the receiver (working with the Bank of Ghana) to expedite the validation and payment of depositors so that all depositors will receive their monies after validation.”

He stressed: “I will also like to add that this refund will also extend to customers of DKM who have not as yet received the full refund of their deposits. We are therefore cleaning up the mess the NDC created in the financial sector.”

Further stressing on the banking crisis, the Vice President said: “We inherited a financial system that was weak and fragile with several institutions that had collapsed or were on the verge of collapse. The Bank of Ghana in cleaning up and strengthening the financial sector, revoked the licenses of many banks, savings and loans and microfinance companies. Some have criticized the action of the central bank for a variety of reasons.

“(But) first of all, let us remember that the failures of financial institutions that we have witnessed recently, were a direct result of a system of poor licensing, non-existent capital, weak corporate governance characterized by related party transactions, political influence peddling, cronyism, among other things.

“The NDC government and the previous management of the Bank of Ghana had ample time to address impending failures. They were aware of the problems in 2015 in the case of banks and as far back as 2012 in the case of savings and loans and microfinance companies. Even in opposition, I alerted the country that on the basis of available data, 8 banks were likely to collapse but they refused to act”.