The Bank of Ghana (BoG) says the culture of regulatory leniency that once prevailed in the banking sector will not be countenanced going forward.

According to the BoG regulatory compliance in the industry was generally weak, with wanton breaches of regulatory requirements hence the need to sanitize the system.

The Second Deputy Governor of the Bank of Ghana, Elsie Addo Awadzi said the BoG’s statutory mandate which includes the responsibility to promote the stability of the financial system, and to protect the interests of depositors “is a responsibility the management of the Bank of Ghana takes very seriously.”

“In light of this, the culture of regulatory forbearance that once prevailed will not be countenanced,” she added.

Mrs Addo Awadzi was speaking at a stakeholders meeting in Accra on Tuesday under the theme: ‘Building a Resilient Banking Sector to Support a vibrant Ghanaian Economy.”

She said, “The recent closures of UT and Capital Bank, as well as the appointment of an official administrator in respect of uniBank, were evidence of a new approach of enforcing the regulatory framework to help protect the interests of depositors and the financial system as a whole.”

She noted that while the outlook of the banking sector is positive, there are a few pockets of vulnerability in the sector which “we continue to monitor on an active basis to ensure that the banking sector continues to be safe and sound and that depositors’ funds remain safe.”

Capital requirement

On the new capital requirement, Mrs Addo Awadzi said the Bank of Ghana “expects all banks to comply with this requirement by the specified date of December 2018.” 

She said, “It remains our view that this new capital floor will help make banks stronger and resilient, and position them to better support the Ghanaian economy."