It is more than pleasing to learn that the regulator of the banking industry, the Bank of Ghana, intends to dig deeper and unravel the factors that accounted for the collapse of UT and Capital banks.
This is because whilst it is important to protect the interest of depositors, which necessitated the take-over of both entities, it is equally important to probe further and ascertain the reasons that lead to their collapse, so that culprits, if there are, can be punished, and for lessons to be learnt.
It is therefore prudent for the BoG to investigate the top management of both banks and if found culpable or liable, the necessary sanctions, according to the Banking Act, 2007, applied to restore confidence in the banking industry.
Protecting depositors’ funds is of paramount importance and it is commendable that the BoG was able to assuage emotions and calm nerves by directing the second largest bank in terms of asset-base, the Ghana Commercial Bank, to take over the operations of the liquidated banks.
It would be interesting to find out what led to the insolvency of the two banking entities and as a result, put in measures to prevent the repetition of such lapses. We are aware that the BoG intends to announce a new capital requirement for commercial banks and it is deemed to be substantially more than what pertains today.
This would force thinly capitalised banks to either merge or be completely acquired to meet the new requirement. It would reduce also the preponderancy of flagrant violations of financial administration regulations that threatens the industry if not tackled with all the seriousness it deserves.
It is interesting that the announcement of the collapse of the two banks came on the same day that the B&FT reported a number of bank executives calling for stricter enforcement of regulations by the central bank.
The bank executives were particularly worried about the apparent lack of adherence to corporate governance standards in the industry, and called on the BOG to put immediate measures in place to stem the tide.
The central bank needs to work faster on introducing the corporate governance guideline, which is aimed at ensuring financial soundness in the banking industry.
Completing affordable housing projects very necessary
The assurance given by Samuel Atta Akyea, Minister for Works and Housing, that he will work with “jet speed,” to complete abandoned affordable housing projects is a welcome one, and we at the B&FT wish him well.
As soon as money becomes available, he said, work will commence on the projects, and that they would be completed before the Akufo Addo government commences new ones.
This statement gladdens our hearts because it would amount to a gross act of insensitivity if, for the third time in succession, a new government would come in and begin its own housing project whilst previous ones remain uncompleted.
It would amount to an insult to the people of Ghana, who work their fingers off to pay taxes to the state, if their resources are sunk into more housing projects which would not be completed but left to deteriorate, as we are wont to in this country.
It is sad that it has come to this, really; that, instead of focusing on adding more, the new government would have to find money to complete projects that monies were voted for long ago. How should it have taken us this long and not complete the ones started by former President Kufour as far back as the year 2005, for example?
Good projects that were started by previous administrations have tended to suffer once a new administration is in place, and this has accounted for the lopsided development we have experienced in the past.
The Minister told our Parliamentary correspondent that should the money be made available, in three months his Ministry would have completed the previous attempts by the Kufour and Mahama administrations to build affordable homes for Ghanaian workers.
We therefore urge government to help make the money available; the projects cannot be left to rot away whilst a humongous housing deficit stares us in the face.
It goes without saying that affordable housing has eluded Ghanaian workers for far too long, and it is about time that some specific policy is in place to address that housing deficit, reckoned to be some 1.7 million housing units.
In this regard, we are hopeful that the Akufo-Addo administration will look for funds to complete the projects so as to ameliorate the situation where Ghanaian workers suffer unduly for accommodation, which is a basic human need.