Some local banks hit by panic withdrawals

Some local banks hit by panic withdrawals
Source: Ghana| JoyBusiness | JAD
Date: 13-08-2018 Time: 08:08:35:pm
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Some local banks are said to be under pressure due to current challenges facing the banking sector.

Sources say the issues facing the banking sector have resulted in some panic withdrawals from these institutions.

For some of these local banks, a day does not pass without a customer making enquiries about their investments or accounts.  This has at times, led to the customer closing the account or moving it to a foreign bank.

Reasons

According to some of these banks, their position is worsened by the recent collapse of five banks. All five of them being local financial institutions.

They explain that this gives the impression that all local banks are in a precarious position.

Explaining further, a number of these local banks, have disputed this, arguing that their financial statements for 2017 and even half year 2018, demonstrate that they are not in distress and ensure good corporate governance practices.

Challenging times for local banks

A customer who can be described as a “high net worth client” for instance has told JoyBusiness that due to current happenings in the banking sector, he has closed his accounts with three local banks and moved them to one of the big foreign banks in Ghana.

Sources say government’s decision to move its accounts, held with the commercial banks, to the Central Bank has also complicated the issue for the banks which were depending heavily on these deposits for their operations.

JoyBusiness also understands that one of the biggest local banks recently had to turn to the Bank of Ghana for emergency liquidity support to “kind of stay alive”.

Checks with the Central Bank show that out of the 30 Commercial Banks operating in Ghana, 13 are local.


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