Dr. Mahamudu Bawumia, flagbearer of the New Patriotic Party (NPP), has asserted that the banking sector clean-up was essential to prevent the total collapse of Ghana’s banking system.
During a discussion with members of the clergy in the Northern Region, Dr. Bawumia revealed that the government had to make the tough decision to allocate GH¢25 billion to revoke the licenses of 420 banks and specialized deposit-taking institutions. This move was aimed at protecting the deposits of over 4.6 million depositors.
Dr. Bawumia emphasized that this decision also helped preserve numerous jobs in the sector.
“One of the biggest nightmares I had was that it was clear that if we didn’t move, move to rationalise the banking system and shut down some of these banks, the whole system was going to collapse. So we had to find GH¢25 billion to save the banking system, and we saved the deposits of 4.6 million depositors by just moving their deposits to new banks like the Consolidated Bank. Otherwise, they would have all collapsed, and we would have lost so many jobs.”
However, he noted that some individuals might still face challenges in retrieving their locked-up funds due to the nature of their investments.
“For some of the securities like Gold Coast Securities and so on, these were investments that were made by people and not bank deposits and people basically make their own evaluations of the risks involved when investing in certain institutions. Sometimes, when they make a lot of money, you don’t hear complaints but when they lose money then we may hear some complaints,” he clarified.
Source: www.ghanaweb.live