In a memo to Parliament, the Finance Minister, Ken Ofori-Atta, argued that the financial sector is very interconnected and for instance troubles from the banking sector could easily spill over to the pensions' industry, threatening the future of millions of workers.

According to the National Pensions Regulatory Authority (NPRA), the industry’s total assets under management (AUM) run in excess of GH¢10 billion.

Mr Ofori-Atta’s memo to Parliament said GH¢11.65 billion of the requested amounts would be used to protect depositors of the nine indigenous banks that lost their licences between 2017 and 2019 over certain regulatory breaches.

They include UT, Capital, Sovereign, Construction, Royal, Beige, Unibank, Premium and Heritage banks.

The rest of the approved funds will be used to sort out depositors in collapsed institutions in other various segments of the financial sector ranging from savings and loans, finance houses to fund management companies.

Background

The government of Ghana said it was on course to secure Parliamentary approval for GH¢15.6 billion bailout for the financial sector clean-up.

This follows after some media reports showed that Parliament had rejected the request.

The Information Minister, Kojo Oppong Nkrumah, who is also a member of the Finance Committee of Parliament who disclosed the information stated that contrary to the media reports, the request has not been rejected.

"The committee held a meeting on Thursday, 5th December 2019, and received the government’s request and even explored if the government could spend a bit more on the exercise.

The report of the committee is expected to be taken to the plenary this week for parliamentary approval," he said.