BoG to Finalize Fate of Struggling Local Banks By July

The Bank of Ghana (BoG) is set to take a final decision on the fate of local banks that may not meet the capital requirement by July. Even though banks in the country have until

December 31st this year to meet the 400 million cedis capital requirement, the central bank is said to have already drawn its own plans to force mergers among some indigenous banks.

Speaking to journalists at the presentation of the policy rate, the Governor of the Bank of Ghana, Dr. Ernest Addison stated that the central bank will finalize the way forward for local banks struggling to meet the minimum capital requirement at its next Monetary Policy Committee (MPC) meeting slated for 23rd July.

He announced that this will be the last opportunity given to the indigenous banks to convince the central bank on plans to meet the requirement, failure to do so will trigger options available. "We already know what the options are. Let's wait for the next MPC meeting. We will get a clearer view of which banks will be able to meet the targets that we have set and those banks that cannot," he said. "Any decisions that we will take are decisions based on where we as a country want to go.

As you can see the discussions are ongoing. As I said, we expect the committee to come with a report on the things the government can do to support indigenous banks by the next MPC meeting," he added. Dr. Addison maintained that local banks must be ready to consider options outlined by the central bank to strengthen the financial space.

He, however assured that the central bank will work to strengthen the participation of local banks in the economy. Some local banks in April 2018 appealed to the president to extend the deadline of meeting the capital requirement.

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