IMF’s recommendation led to UT and Capital Banks’ license revocation – BoG Governor

The Governor of the Bank of Ghana, Dr. Ernest Addison, has disclosed that the International Monetary Fund’s (IMF) recommendation to stabilise Ghana’s financial sector led to the revocation of banking licenses for UT Bank and Capital Bank.

Dr. Addison explained that his tenure as Governor coincided with a period of significant challenges within the Central Bank.

To address these crises, the IMF recommended extensive reforms, which included the revocation of licenses for UT Bank and Capital Bank.

Speaking at this year’s Governor’s Day dinner organised by the Chartered Institute of Bankers, Dr. Addison elaborated on the difficult decisions made to safeguard Ghana’s financial sector.

“There are a few requirements which the IMF calls prior actions. You have to do this, you have to do that; otherwise, they are not even going to organize a board meeting to discuss Ghana and disburse any funds to you,” he stated.

Dr. Addison noted that as Governor, he initiated a clean-up of the banking sector to restore public confidence and ensure financial stability.

This included revoking the licenses of several banks in the country.

“This was one of the prior actions—to dissolve UT and Capital Bank. Ghanaians had not witnessed such actions in a long time. Many were shocked when the licenses of the two banks were revoked,” he added.

Between August 2017 and August 2018, seven banks, including Beige Bank, uniBank, UT Bank, Capital Bank, Sovereign Bank, Construction Bank, and Royal Bank, had their licenses revoked.

The Central Bank accused the management of these banks of violating Ghana’s banking regulations.

FKA/MA