The Vice President, Mahamudu Bawumia, has replied former President John Mahama’s assertions that the financial sector clean-up was mishandled by the central bank.

In his view, the reforms by the Bank of Ghana, are in order and have brought finality to problems caused by “lack of oversight and years of poor regulation” superintended by the erstwhile Mahama administration.

Dr. Bawumia said at the launch of a UN-sponsored housing project in Accra Wednesday, that had the BoG not taken the “bull by the horn” to clean-up the sector, more than 4.6million people would have lost their deposits; a number the Veep says is seven times the government workforce.

He said that much people losing their money would have been the real “national security threat,” referencing Mahama’s assertions in a Facebook live video that the financial sector challenges are a threat to national security.

VP Mahamudu Bawumia

According to Dr. Bawumia, who once served a Deputy Governor of the BoG, the mode of clean up by the central bank is the best considering nature of the rot.

In 2017, Capital Bank and UT Bank had their licenses revoked and their assets and liabilities were absorbed by state-owned GCB Bank.

Since then, seven banks have been collapsed and have been consolidated to form the Consolidated Bank Ghana Limited owned by the state.

The BoG says some of these banks acquired their licenses through fraudulent means “by presenting non-existing capital.”

However, no persons have been convicted of any offenses.

Twenty-three microfinance institutions were also collapsed last week. Many experts have lauded the central bank for taking the bold step. “It is long overdue,” some said.

Addressing the BoG’s approach to the clean-up, Mahama lamented the loss of jobs and the collapse of Ghanaian owned businesses.


John Mahama is gunning to returning to office in 2021

But in a reply, the Veep says the clean-up has rather saved some 3,000 jobs which would have been lost if the struggling banks were left to collapse.

He said the GCB Bank and the Consolidated Bank have retained thousands of employees from the defunct institutions.