Financial analyst, Sydney Casely-Hayford, has urged the state to prosecute and jail Bank of Ghana (BoG) officials who issued licenses to three banks who presented fake documents to obtain the permit.
Mr Casely-Hayford is also pushing for the prosecution and jailing of the owners of some five banks that have been consolidated because they breached key operating regulations.
The central bank put down its foot on Wednesday and announced the creation of Consolidated Bank Gh. Ltd to take over the five erring banks.
Photo: Five Managing Directors of the dissolved banks: L-R: Stephen Kpordzih (Construction Bank) Osei Asafo – Adjei (Royal Bank) Dr Duffuor II (uniBank), Johan Rheeder (Royal Bank) , Mike Nyinaku (Beige Bank)
Apart from breaching BoG regulations, the five banks, Sovereign Bank, Royal Bank, The Beige Bank, Construction Bank and Unibank, according to the central bank, have also run into liquidity challenges.
Government has made 450 million cedis available for the Consolidated Bank as starting capital and has named Daniel Addo as its CEO.
The BoG said its investigations have revealed that The Beige Bank, Sovereign Bank and Construction Bank obtained their banking licences illegally through the use of suspicious and non-existent capital.
Speaking on Adom FM’s Current Affairs programme, Burning Issues on Wednesday, Mr. Casely-Hayford said punishing the BoG officials and the owners of the banks found culpable for the illegality would inhibit others from replicating such practices.
Mr. Casely-Hayford believes the banking supervision department of the Bank of Ghana has suffered major problems and “it is going to become very important that even after all this situation, that certain persons be arrested and tried and indicted, and maybe prosecuted and jailed.”
Photo: Sydney Casley-Hayford is a financial analyst
He says there were so much malpractice and illegalities going on in the sector that should not be tolerated as the BoG strives at building confidence in the sector.
The financial analyst believes that if persons involved in the various regulatory breaches are not jailed, they may surreptitiously return to open up other banks.
“If certain people are not jailed, people may think BoG have just taken interest in collapsing some banks meanwhile, the purpose of this exercise is due to the investigations which are being carried out on how these fraud licenses were attained to set up these banks,” he stressed.
Related video: Analysis of the consolidation of the five banks
Another financial analyst and head of research of Groupe Nduom, Sammy Ampah, has lauded the consolidation move by the BoG, saying the decision will “strengthen the banking sector.”
Mr Ampah also spoke on Burning Issues, Wednesday.