The flagbearer of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia, has justified the banking sector reforms undertaken by the government and Bank of Ghana.
The banking sector clean-up exercise, which took place from mid-2017 to January 2020, resulted in a reduction in the number of banks from 34 to 23, along with the closure of 347 microfinance institutions, 15 savings and loans, and eight finance houses due to various breaches, according to the Central Bank.
According to the Vice President, the clean-up exercise was necessary to safeguard the investments of over 4.6 million depositors who had kept their funds in some of these now defunct financial institutions.
Addressing journalists on Sunday, August 25, 2024, during an encounter with the media, the NPP flagbearer called out the former president, John Dramani Mahama, who has hinted at plans to restore the licenses of these financial institutions that were unjustifiably collapsed by the current government.
“I don't understand whether the former president has taken the time to actually understand what happened in the banking sector. Some atrocious things happened, and this is why these banks had to be saved. They were not collapsed. They were merged into other banks. And no banking depositor lost one cedi," Dr. Bawumia stressed.
He mentioned that the situation in the financial sector at the time was indeed dire, which almost resulted in a complete collapse of the banking system.
"Most people didn't understand how close we were to a collapse of the entire banking system. But we were this close because all it would have taken was for a few depositors to go to UT Bank or UMT and they'd tell you there's no money. What would happen? There would have been a complete run on the banking system in Ghana," the Vice President explained.
MA/AE
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