B&FT Editorial: Recovery rate for depositors' funds not impressive

Governor of the Bank of Ghana, Dr. Ernest Addison, at the policy rate press briefing last week was queried by B&FT's economic correspondent on how much has been recovered so far after nine banks were declared insolvent in the banking clean-up exercise.

He indicated it is little over 8 percent and conceded that the recovery has so far been unimpressive. We couldn't agree with him more, since depositors are in limbo as to when exactly their deposits will be refunded.

We are therefore using our space to urge the receiver and the stakeholders to work with a little more dispatch and ensure they diligently retrieve depositors' monies, so that they can go about their lives without distress.

"The last time I checked, about GHC1.4billion had been recovered; and were looking at a loan portfolio of over GHC16billion for those banks that were resolved. So out of the GHC16billion if we have recovered just GHC1.4billion, it tells you that there is lot of work to be done."

Thus, the governor himself admits that a lot of work has to be done to speed-up the process. Our worry is for the depositors, since they were taken by surprise and did not have ample time to withdraw their savings.

The process is going much too slowly, and this concern is being felt by depositors in no uncertain terms. Bank failures are widely feared because depositors may suffer losses in the value of their deposits and restrictions in access to their deposits.

To some extent, the recovery efforts have been hampered by legal challenges mounted by some complicit persons intending to frustrate the receiver. We cannot deny them legal redress, and we understand how frustrating these processes can be.

However, that notwithstanding, the process needs to be assigned priority in other to assuage the anxiety of depositors.