Business News Tue, 7 Sep 2021

Banking sector clean-up: Speed up pursuit of monies from indicted persons – Prof Quartey to govt

• Govt has been charged to hasten its pursuit in retrieving funds from collapsed financial institutions

• This Prof. Peter Quartey believes will restore sanity in the financial sector

• So far, only GH¢1.7 billion out of a targeted GH 25 billion has been retrieved

Head of the Institute of Statistical, Social and Economic Research (ISSER), Prof. Peter Quartey, has urged government to hasten its pursuit of retrieving funds from persons found culpable for the banking sector clean-up exercise.

According to the Economist, this is necessary to restore confidence back in the financial sector as well as boost the country’s recovery efforts from the coronavirus pandemic.

Prof. Quartey in an interaction with Citi Business said, “the banking sector clean-up came with a lot of costs, but some persons were mentioned as being culpable. So, we should pursue such persons to recover funds taken from banks to ensure sanity prevailing”.

He added that, “by extension, all the things I have mentioned should apply to other financial institutions like microfinance, savings and loans, and other non-bank financial institutions, so that people can have confidence in the financial system to enable us to stimulate the economy.”

As part of a regulatory crackdown back in 2017, the Bank of Ghana undertook a number of reforms to clean-up the banking sector which was at the time on the brink of collapse as a result of corporate governance breaches and insolvency issues.

The exercise resulted in the revocation of banking licenses which led to a reduction of banks from 34 to 23 including indigenous ones.

While the assets managers of the defunct institutions have been able to recoup some of the monies, there are still concerns the recouped amount is rather short beyond its target.

Dr Ernest Addison, Governor of the central bank in an interaction with journalists in May this year revealed that only GH¢1.7 billion out of a targeted GH¢25 billion has so far been recovered after almost four years since the cleanup exercise was undertaken.
Source: www.ghanaweb.com
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