Bank of Ghana was right in revoking GN Bank’s licence - High Court tells Dr Nduom

The court ruled that the central bank had acted lawfully in the interest of shareholders and the public, and therefore, the application could not be sustained.

The court, having confirmed the capacity and jurisdiction of the applicants, delved into the substantive issues raised, which included allegations of discrimination, unreasonableness, unfairness, and violation of administrative rights.

One of the main contentions from the applicants was the violation of administrative rights, arguing that an honest assessment by the BoG would have revealed the solvency of GN Savings and Loans, and the license should not have been revoked. They claimed that if the government settled its debt, the capital adequacy ratio would have been met.

However, the court dismissed these claims, asserting that the BoG, as an administrative body empowered by the Bank of Ghana Act, was duty-bound to ensure strict supervision. If the applicants failed to meet the required threshold and were not solvent at the time of revocation, the BoG had the authority to take necessary actions.

The court recommended that the applicants address the issue of the government's debt with the Finance Ministry, highlighting that the BoG's decision was reasonable and aimed at protecting the public interest.

On the matter of discrimination, the court concluded that the applicants were not unfairly treated, as other entities faced similar consequences. The court deemed the complaints of the applicants as unfounded and without merit.

Background:

This legal battle dates back to June of the previous year when the Court of Appeal upheld the Bank of Ghana's application to refer the case to arbitration. The Court ruled that, according to section 141 of the Banks and Specialised Deposit-Taking Institutions Act, 2016, Act 930, the appropriate forum for such challenges is arbitration, not the court. The Court also noted that Dr. Papa Kwesi Nduom and the other applicants had incorrectly framed their challenge as a human rights application.

Despite this decision, Dr. Nduom and his legal team filed a motion at the Supreme Court, contesting the Court of Appeal's ruling. The panel of three at the Court of Appeal, led by Justice Henry Kwoffie, maintained that the matter should be referred to the Ghana Arbitration Centre, emphasizing that it was not a human rights issue.