Ghana's Central Bank begins probing staff involvement of 7 banks collapse

The Second Deputy Governor of the Bank of Ghana (BoG), Elsie Awadzie has said that the bank’s Office of Ethics and Internal Investigations has started probing the collapse of seven banks between 2017 and 2018.

According to the Second Deputy Governor, the investigations will focus on the roles played by the staff of the BoG in the collapse of the banks.

“This Office will be coming out with a report – we hope soon – that will let us all know whether any of our staff members, past or present, were complicit in the failure of these banks. We think that is an important part of the correction process.”

In almost one year Ghana’s Central Bank closed down 7 indigenous banks for insolvency and breaches of banking regulations.

In August 2017, the BoG permitted the GCB Bank to take over now-defunct UT Bank and Capital Bank. The two banks had liquidity challenges.

Second Deputy Governor of the Central Bank, Elsie Awadzi, ece-auto-gen

In a few days shy away from a year of this major banking challenge, the Governor of the BoG, Dr Ernest Addison announced the merger of 5 local banks into the Consolidated Bank of Ghana Limited.

The 5 banks are Beige, Sovereign, Construction, UniBank and Royal Banks.

These challenges led to panic among Ghanaians and caused chaos in the financial system.

Some Ghanaians and banking experts blamed the regulatory authority for looking on while the malpractices happened in the banks. Others suggested that they should be held culpable for their acts.

However, Mrs Awadzi said the Institute of Chartered Accountants, the professional body for auditors, will soon publish a report indicating the role of its members in the crisis.

To prevent such an incident from happening again Mrs Awadzi the BoG is developing directives to specify the roles and the expectations of external auditors of banks “so that when all of us read the financial statements that published we can be sure that the right things have been done.”