BoG could have saved Construction, Sovereign banks – Financial analyst

BoG could have saved Construction, Sovereign banks – Financial analyst
Source: Ghana| Myjoyonline.com| Oswald K Azumah| oswald.azumah@myjoyonline.com
Date: 04-08-2018 Time: 12:08:58:pm
Sovereign bank [L] - Construction bank [R]

A financial analyst has argued that the Bank of Ghana (BoG) should have exercised more leniency in the consolidation of the five defunct banks.

Emmanuel Akrong said the Central Bank was right to have revoked the license of UniBank, Beige bank and Royal bank due to their insolvency.

“The law says if a bank becomes insolvent, the Bank of Ghana shall move in to close it down so they did well to do that,” he said.

Mr Akrong was, however, in disagreement with the liquidation of Construction Bank and Sovereign Bank.

Speaking to news analysis programme, Newsfile on the Joy News channel on Multi TV Saturday, Mr Akrong said there were other options available to the regulator instead of just closing down Construction and Sovereign banks.

Read: uniBank beyond saving as shareholders illegally disburse ¢5.3bn – BoG

He explained that since they weren’t insolvent like the other three, they [BoG] could have bailed them out instead of just winding them up as well.

“Looking at the business model of the banks, in my opinion, they should have been kept alive, and given another share holder…” he stated.

“Luckily the Finance Ministry said if you’re a solvent and well-run bank you could come to me for ¢400million so I don’t understand why they didn’t give them that option to access ¢400 million and kick out the shareholders,” he added.

Construction was winding up

Responding to the fact that Construction bank was winding up by itself already, Mr Akrong noted that it was a sign of confidence in the bank that it was in appreciable financial standing.

“If they couldn’t pay their liabilities they won’t wind up,” he said.

Read: Bank Collapse: BoG Governor to be hauled before Parliament

But in a sharp contrast to his point, Second Deputy Governor of the Bank of Ghana Elsie Awadzie noted that the fact that the two banks, (Construction and Sovereign banks) acquired their licenses under false pretences meant action had to be taken against them.


The five banks, Sovereign, Construction, Beige, UniBank, and Royal Bank were merged by BoG to form The Consolidated Bank Ghana Limited for various reasons.

Daniel Wilson Addo, a Chartered banker with 12 years experience in management positions is its Chief Executive.