President Nana Akufo-Addo has instructed the Ministry of Finance to release an additional GH¢1.5 billion for customers affected by the 2017 to 2019 banking sector clean-up.
Dr. Mohammed Amin Adam, the finance minister, made the statement over the weekend at a UK Town Hall meeting.
The amount is part of a GH¢4 billion total outstanding amount to settle the individual and institutional customers of failed financial institutions and would be disbursed between June and October 2024, according to the Minister.
“The president has directed that we do another bailout. So between now and October, we will release GH¢1.5 billion to the affected people. This will not pay the entire amount because the entire amount is GH¢ 4 billion,” Dr. Adam stated.
Dr. Adam emphasised that the money will be disbursed as soon as possible in order to provide affected customers with relief during the timeline that runs from now until October.
He also addressed worries about how the banking sector clean-up affected investors and depositors, noting that the government is aware of the challenges that affected parties are facing.
He stressed that although the state might not be held accountable for specific investment choices made by individuals, it does bear accountability for the well-being of those citizens who have suffered financial setbacks due to insufficient guidance and information.
“Ideally, Government should not be held responsible for the investment decisions of individuals, but this government is so caring,” he said.
He recognised the suffering endured by those impacted and mentioned the sad results of the regulatory actions, including fatalities and suicides.
“Mistakes were made and people were not well-informed, and they didn’t know who to consult to be advised, but we also know that the people who are affected are suffering, and we have heard that some people have died and others had to commit suicide,” he furthered.
Background
On May 31, 2019, the BoG suspended the licenses of about 347 microfinance and 39 microcredit organisations that were in operation in the nation.
The BoG also revoked the licenses of 23 finance houses and savings and loan companies on August 16, 2019.
Earlier in 2017, some banks also had their licenses revoked, and others merged to form Consolidated Bank Ghana Limited. This brought to a total of 420 financial institutions who have had their licenses revoked by the central bank so far because it believed them to be insolvent.
According to the BOG, the reforms were implemented in the utmost interest of depositors, spending approximately GH¢25 billion.
Many customers of dissolved and operational yet illiquid SDIs have decried the unwillingness of the government to assist with the release of their locked-up investments with some specialised deposit institutions, which are largely regulated by BOG.
The Investment Holders Forum has been picketing for several weeks at the premises of the Finance Ministry to demand their locked-up funds.
Last month, the government announced the release of GH¢ 2.3 billion for the recapitalization of the National Investment Bank, with the first tranche to be released by the end of May 2024.
According to Minister Adam, the support for NIB is part of the implementation of the Post-Covid-19 Programme for Economic Growth (PC-PEG).
*****
Never miss out on the news. Get your valuable breaking news and other vital content by following The Sikaman Times on WhatsApp Channel
*****
