The Bank of Ghana has released Mergers and Acquisitions Directive for banks seeking to acquire other banks or merge to become a bigger entity.
This comes barely 2 weeks after the BoG released the Capital Requirement Directive for banks.
The Capital Requirement Directive for sets the requirement by which banks will calculate their level of capital ahead of the December 31 deadline.
But the Mergers and Acquisitions Directive shows the relevant legal basis to consider a merger or acquisition, the specific requirements of the financial institutions in question and the possible sanctions for non-compliance.
According to the Central Bank, the directive seeks to protect the interest of the financial institutions; depositors as well as secure the financial industry from any potential threat.
It is also to emphasize the need for all decisions on proposed mergers and acquisitions to be submitted to the Bank of Ghana for consideration before any step could be taken.
The institutions must, however, admit that the BoG could reject the acquisition of shares by a person who, in the bank’s opinion, would not be a fit and proper person.
In the same vein, the BoG can cancel an approval when it gets enough basis to dismiss its earlier decision.
Per the directive, the Bank of Ghana should within ten days reply with a formal letter of acknowledgment/letter of deficiency on proposals submitted to it, as the case may be.
However, as a financial institution, you should get a response from the regulator after six months of your submission granted all your documents are intact.