Mr. Ernest Adade, a member of the ruling New Patriotic Party’s (NPP) communications team, has vehemently defended President Akufo-Addo’s government’s decision to sanitize Ghana’s banking industry and rejected assertions made by some members of the public that the decision regarding banks was not in the best interests of Ghana.
“The best decision was to clean up the sector and recapitalize some banks.” “If the Finance Ministry hadn’t started that cleanup effort in 2017, the whole industry would have collapsed,”Mr Ernest Adade told Kwaku Owusu Adjei on Adwenepa on Accra-based Original TV.
Mr. Ernest Adade maintained that the government needed to move quickly to implement the recommendations of a study that the Akufo-Addo administration had been given. This report served as the basis for the cleanup of the banking industry.
“The Bank of Ghana evaluated every bank in the nation in 2015. Ten banks were deemed to be in trouble and required to be recapitalized in order to preserve depositors’ money, according to the Assets Quality Review exercise,”he added.
Additionally, he contended that the Bank of Ghana’s supervisory division’s indifferent attitude toward the mismanagement of those banks, coupled with low liquidity and mismanagement of funds injected into them by the central bank during the previous John Mahama administration, were the main causes of the challenges the ten banks faced.
“The Assets Quality Review study states that those banks should have failed or merged before 2016, but for reasons that are still unknown, this never happened. The cleanup effort was initiated because the current government was only elected to carry out the report’s recommendations,”Mr. Ernest Adade added.
He emphasized that the current approach to banking in Ghana was the only one that could save it. Under the previous (NDC) government, the Bank of Ghana provided liquidity support to the failing banks on multiple occasions. However, these funds were lost due to the owners and managers of those banks misusing them once more.
