Alban Sumana Kingsford Bagbin, the Speaker of Parliament, has chided Nana Addo’s government for the financial sector cleanup, stating that the government has erred in collapsing indigenous banks.

According to the Speaker of parliament, the government got it wrong in its approach to the banking sector clean-up, which resulted in nine banks and dozens of financial firms having their licenses revoked by the Bank of Ghana (BoG) between August 2017 and 2019. Mr. Bagbin noted that even many of the banks which survived the banking sector cleanup, have already collapsed.

Mr. Bagbin made this known while responding to a question in a meeting with the Parliamentary Press Corps in Parliament on the status of a probe he has directed into the revocation of licenses of UT Bank and UniBank. To Mr. Bagbin, it should have been the focus of the government to save the banks instead of revoking their licenses.

“I think our colleagues in government erred in not seeing it that way but rather made sure that Ghanaians who were trying to enter into the sector lost out. Instead of using about GH¢5 billion to support the banks to survive, we ended up using about GH¢25 billion, but we have not been able to sanitize the sector. What has rather happened is that if they bring their books now, many of the supposed surviving banks have collapsed.”
Alban Sumana Kingsford Bagbin

The Government Misunderstood the Banking Situation

The government, Mr. Bagbin said, misunderstood the situation and adopted the wrong approach to the challenge the sector faced. “Our friends in government misunderstood the situation and thought that the clean-up involves the complete sellout of the banking sector to foreign interests,” he indicated. The role of banks in the economy of the country, he said, is very important hence the need for it to be controlled by indigenous people.

“You know the roles the banks play in our economy. If the shareholders of your banks are all foreigners, and you know it is the banks that make the money so the dividends go to the shareholders, who are not Ghanaians. So your sweat and your toil go into the banks and the profit is taken away in the form of dividends by the shareholders, who are staying outside the country.

“It should be the focus of every country to make sure that they are in control of the banking sector. So if Ghanaians who had banks and were having challenges, it is incumbent on us to support them to succeed for us to continue to be in control of the banking sector.”
Alban Sumana Kingsford Bagbin

Giving an update on the probe, the Speaker said “the response from the [Adhoc] Committee has not been encouraging. I have on many occasions drawn their attention but have not received any report yet. They said they are having some challenges but we are still following up.”

It can be recalled that following the petition by Prince Kofi Amoabeng and Dr. Kwabena Duffuor, Speaker constituted the committee, chaired by the First Deputy Speaker, Joseph Osei-Owusu, in March 2021, to probe the circumstances surrounding the collapse of the two defunct banks.