BoG Sets Up Ethics & Internal Investigations Unit To Strengthen Financial Sector

Bank of Ghana has set up an Office of Ethics and Internal Investigations as a first line of defense in its strategy to strengthen the financial sector.

This was revealed by Information Minister nominee, Kojo Oppong Nkrumah at a press briefing.

Citing a four step strategy by the government to improve the financial sector, Mr. Nkrumah revealed that the office was necessary to allow the Bank of Ghana to internally check itself.

The move has become necessary in view of the lapses within the operations of the regulator that led to the collapse of some seven local banks.

“One final question is what the Bank of Ghana is doing to ensure that the regulators do not slip. I am pleased to announce to you that an office of ethics and internal investigations has been set up in the Bank of Ghana to commence the first line of interrogation of their own systems and procedures and persons who may have been culpable in this exercise and it is expected that persons who are found culpable in this will be dealt with  and most importantly, these infractions do not continue.”

He also cautioned the public against politicization of the banking sector troubles.

There are some who seek to reduce everything in this country to partisan politics. Indeed in recent weeks, some political actors claiming that the clean up is politically motivated and that it is ill driven. This is blatantly ill formed. This is rather the time to tone down and soberly reflect and come to terms with the nature of the challenge and the efforts that the new administration is making to resolve it.”

“Indeed if we want to be partisan with it then the current administration will rather be the one with the moral high ground to question members and assigns of the previous administration on what they did all of these years as the situation deteriorated further. But our focus is to govern and deliver change in all areas including the financial services sector, and so we will stick to that and leave the partisanship for another day.”

Finance C’ttee to probe banking crisis

Meanwhile, the Finance Committee of parliament has scheduled a three-day hearing to probe the banking crisis.

After a crunch meeting in parliament, the committee scheduled the hearings from 5th to the 7th of September. On the 1st of August, the Bank of Ghana announced the formation of the Consolidated Bank of Ghana after the collapse of some 5 banks.

Speaking to press after the meeting, Chairman of the Finance Committee, Dr. Mark Assibey Yeboah, said the committee had written to the bank of Ghana for the relevant documents that will help them in the probe.

The Governor of the Bank of Ghana, Dr. Ernest Addison, recently revoked the licenses of five banks; Sovereign bank, Beige Bank, Construction Bank, Royal Bank and uniBank.

This was after UT and Capital Banks, which collapsed first, were taken over by GCB on the instructions of the Bank of Ghana.

The Governor, Dr. Ernest Addison, said some of the five newly collapsed banks had committed various offenses against the country’s banking laws including obtaining their licenses through false pretenses.

The governor said the five had therefore been collapsed into a new bank; the Consolidated Bank of Ghana and deposits of the collapsed banks had been transferred to the Consolidated Bank

The banks collapsed despite the fact that the Bank of Ghana had supported them with hundreds of millions of cedis to enable them to recover from distress.

Their collapse has however resulted in the state incurring more cost in fixing the mess created.

This has increased public agitation as some of those said to be complicit in the mismanagement of the banks misapplied the funds leading to the eventual collapse.