A Financial expert has encouraged banks to consider merging with other banks in order to meet the Bank of Ghana’s minimum capital requirement and operate viably.
Mr Emmanuel Adu-Sarkodee, the Chairman of CDH Balanced Fund Limited said: “Merger is the best way to go in the current dispensation. I see more mergers happening in the banking sector if banks are unable to find the minimum capital requirement.
“Local banks need to merge to curtail the ‘internationalisation of banks’ in the country.”
Mr Adu-Sarkodee was addressing journalists after the CDH Balanced Fund Limited held its Third Annual General Meeting, in Accra on Thursday.
CDH Balanced Fund is a collective investment scheme, particularly, of mutual funds, managed by the CDH Asset Management Limited.
On the decision by the Bank of Ghana to consolidate some five banks, Mr Adu –Sarkodee said he saw the actions by as a process of “refinery”
According to him, the current Banking Act, Act 931, “seeks to refine the banking sector by way of straightening corporate governance and keep local banks in check.”
He said the act of refining the banks would not stop any time soon once the banking sector was undergoing various reforms.
Mr Adu- Sarkodee assured shareholders that the CDH Balance Fund was poised to attain more growth hence it was ensuring that it adhered to good corporate governance practices.
“CDH has undergone a lot of refinery, you know our history, hence we don’t expect it to be hit by any directive because we are adhering to all the rules of the game.”
On the current depreciation of the cedi, Mr Adu-Sarkodee noted that the situation was not as bad as it used to be in the past years.
“This does not mean we are not feeling it. Some of our customers are crying over the situation and the trends seem to affect the payment of some insurance claims,” he noted.
He emphasised that the depreciation of currency was not only happening in Ghana but also in some East Asian countries.
He explained that external factors were rather to be blamed for situation, adding that the situation was not helped by the fact that Ghana was a net importer of goods.
The Financial Expert said the prospect of the Ghana’s economy was bright if the country would manage its financial systems well.