The Bank of Ghana (BoG) has provided a Gh¢10million grant to assist the Economic and Organised Crime Office (EOCO) to do its work.
Portions of the grant are to assist the EOCO to complete investigations into the causes of the mess in the banking sector.
Governor of the BoG said this when he signed a Memorandum of Understating with the investigative body in Accra.
The Executive Director of EOCO, Commissioner of Police (COP) Maame Yaa Tiwaa Addo-Danquah, signed on behalf of the office.
Dr Ernest Addison stated that the malpractices that happened in some of the banks were complex hence the involvement of experts from the EOCO to probe further.
Some of the directors of the collapsed banks, he said, were unable to account for happenings in their institutions.
Others, he added, were also not able to account for what depositors’ funds were used for.
“By this MOU, BoG will provide the needed resources to EOCO to execute its mandate,” Dr Addison said.
It is recalled that financial analysts including Mr Joe Jackson indicated that investors lost confidence in the financial sector following the alleged involvement of the directors in the issues that led to the sectorial crisis.
He told Alfred Ocansey on the Sunrise morning show on 3FM that all the executives of these collapsed banks whose actions and inaction led to the failures should be prosecuted.
“How can we induce confidence in the investor when the signal we are giving out is that someone does wrong and gets away with it? That we haven’t seen any conviction yet is sad,” he said.
He noted that “public confidence is low because they look around and see other officials walking around. Where is the state that is supposed to keep them in check?”
He further expressed concerns over the slow pace of the prosecution of the directors who are currently standing trials.
“Justice delayed is justice denied, this thing has been going on for four years and where are the convictions?
“It is really bad to those of us who operate in the market. Because it says that, if I misbehave, if I am reckless, if I am fraudulent, there will be no punishment and I will get away with it. When you are not convicting them, you are doing the market harm, you are doing the customers harm in terms of confidence and those who are in the business trying to do good and that doesn’t make sense,” he added.
The Bank of Ghana with support from the Finance Ministry swept through the financial sector of the economy between the period 2017 and 2019.
The central bank first started by revising the minimum paid-up capital for existing banks and new entrants from GHS120 million to GHS400 million.
According to the regulator, this was to test the viability of the banks.
The banks that were unable to meet this new requirement were either merged or collapsed.
Following this action, some nine local banks, 23 savings & loans companies, 347 microfinance institutions, 39 finance houses and 53 fund management companies closed down during the exercise.
In total, the government spent GHSS23billion to undertake this exercise
UniBank, The Sovereign Bank, The Beige Bank, Premium Bank, The Royal Bank, Heritage Bank, Construction Bank, UT Bank, and Capital Bank all collapsed.
