Take immediate steps to secure our locked-up investments with affected FHSLs – LIHF to BoG

A group calling itself the Locked-up Investment Holders Forum (LIHF) has expressed its displeasure about what it describes as a lack of action on the part of the central bank to protect the investments of its members.

“We wish to register our utmost displeasure about what we see as a lack of action on the part of BoG, to act to protect our investments and ensure that we are able to access our funds,” a statement issued by the group signed by its convener, Dr Adu A. Antwi said.

According to the group, some Finance Houses and Savings & Loans Companies (FHSLs) “licensed by the BoG have been unable to meet the interest and or principal payment demands of their customers for some time now, and in most cases for about three (3) years.”

It highlighted reasons for the FHSL's inability to meet the demands of their customers including: “Lack of patronage of their services arising from the loss of confidence in the banking and financial services sector following the banking clean-up exercise; Unprecedented withdrawals they experienced at the beginning of the clean-up exercise virtually creating a run on their operations; The inability of their loan customers to service their loan facilities due to the general deterioration of the macro-economic environment in the country and the effects of COVID 19 on their businesses; The government’s inability to make payments against loans granted to government contractors against their Interim Payment Certificates,” among others.

The group noted the BoG must appreciate “the negative effects on public confidence in the Ghanaian financial market, due to these ‘locked-up’ investments.”

It stressed that when “customers of some Banks, Microfinance Institutions and FHSLs faced similar challenges in 2017, the BoG stepped in to settle the deposits and investments of customers of the affected institutions.”

The group wants its members to be accorded the same treatment.

“We believe that we are entitled to, and should be given the same treatment,” the group indicated.

The LIHF also expressed disappointment about the current developments.

“We are therefore worried and disappointed that the BoG has created a situation reminiscent of regulatory inertia and has neglected its regulatory responsibilities owed to investors in these affected FHSLs, allowing us to suffer undue financial hardships,” it said.

It continued: “We find the silence of BoG to our plight as gravely wrong and unacceptable. Apart from the personal hardships and pains caused us, despite planning for our lives to avoid such hardships and pains, the silence does not promote the culture of saving and investing in the country.”

The LIHF, therefore, requested the “BoG to take immediate steps to work to secure” their “‘locked- up’ investments with the affected FHSLs” to enable its members to access their funds.