The Supreme Court has affirmed the decision of the Bank of Ghana (BoG) to revoke the operating licence of Unicredit Ghana Limited.

The court, in a unanimous decision, reversed the decision of the Court of Appeal and upheld that of a High Court in Accra which had found that the BoG committed no error in revoking the licence as it followed the law to the letter.

The BoG on August 16, 2019, declared UniCredit Ghana Limited insolvent and revoked its licence to operate as a savings and loans company, under section 123 of the Banks and Specialised Deposit Taking Institutions Act of 2016 (Act 930).

The majority shareholder of UniCredit, Hoda Holdings Limited, later filed an application at the Human Rights Division of the High Court, seeking a judicial review of the decision of BoG to revoke UniCredit’s licence and an order of injunction restraining the bank from interfering with the operations of UniCredit.

The High Court, presided over by Justice Gifty Agyei Addo, in her decision, recognised that the notice of revocation of Unicredit’s licence passed the test of legality because on the face of the notice, it was stated that it was made pursuant to section 123 of Act 930, and on the ground of insolvency, which ground is supported by the provisions of section 123 of Act 930.

The court also held that the act of the BoG in revoking the licence of Unicredit passed the test of reasonableness, it was not arbitrary or capricious because the record reflected the capital insufficiency asserted by BoG.

Court of Appeal

Not satisfied with the decision, Hoda Holdings proceeded to the Court of Appeal to challenge the decision, and the court reversed the decision of the High Court.

The Court of Appeal comprising Justices Janapare A. Bartels-Kodwo, Merley Wood and Gbiel Suurbaareh had held that the Bank of Ghana in revoking the licence of UniCredit under section 123 of Act 930 should have followed the steps provided in section 16(3&4) of Act 930.

It also held that the failure of the Bank of Ghana to comply with the procedure in section 16(3&4) of Act 930 meant that UniCredit was not given a hearing before its licence was revoked.

Supreme Court

The BoG, dissatisfied with the decision of the Court of Appeal, went to the Supreme Court and argued that the decision was against the weight of evidence and that the court misconstrued the import of section 16(7) of Act 930.

A five-member panel of the Supreme Court, presided over by Chief Justice Gertrude Torkornoo and assisted by Justices Mariama Owusu, Prof. Henrietta Mensa-Bonsu, Ernest Yao Gaewu and Yaw Darko Asare, held that from the extensive relay of communication, it was in agreement with the High Court that there was notice in writing given to UniCredit regarding capital insufficiency and liquidity, proposals on actions to be taken, and an opportunity to make a written representation on the matters raised.

The Supreme Court said it was satisfied that on the face of the record, there is evidence of a hearing between Unicredit and BoG before the revocation of Unicredit’s licence.

“We are also satisfied that the revocation of UniCredit’s licence was done in accordance with the stipulated law appearing on the face of the record, and therefore reversed the decision of the Court of Appeal while upholding that of the High Court.”