After throwing the light on the impact of the Ghana Amalgamated Trust (GAT) model on some local banks, Dr. Richmond Atuahene is not leaving the issues hanging; he is proposing a roadmap that can help address the situation.
For Dr. Atuahene, what was once designed as a rescue lifeline for Ghana’s indigenous banks after the banking sector cleanup exercise is now an “albatross” hanging around their necks.
According to banking and financial consultant, among other things, the high cost of funding under the Ghana Amalgamated Trust (GAT) scheme, reportedly compounded at about 19.1% annually plus management fees, has placed enormous strain on beneficiary banks, limiting profitability and slowing growth.
He fears that the equity-linked nature of the funding from GAT threatens the ownership and shareholding of these banks. Without quick intervention, GAT could own all these banks.
Dr. Atuahene has therefore outlined a 10-point policy roadmap aimed at freeing local banks from what he calls a structural burden.
1. Convert High-Interest Debt to Low-Cost Equity
He proposes converting GAT’s high-interest loans into cheaper, long-term equity or convertible preference shares. This would immediately ease liquidity pressure by reducing the heavy interest burden.
2. Restructure Outstanding Tier 2 Capital
Dr. Atuahene urges the Government of Ghana, the Bank of Ghana, and GAT to restructure the outstanding Tier 2 capital, currently running into hundreds of millions of cedis, similar to how government bonds were treated under the Domestic Debt Exchange Programme (DDEP).
He argues that if domestic bonds could move from 19.1% to about 9%, the same relief should apply to GAT capital, which has grown significantly due to compounding. For instance, an initial GH¢243 million injection reportedly ballooned to over GH¢600 million within five years.
3. Ring-Fence and Reduce the Cost of Funding
The Ministry of Finance and GAT, he says, must review the entire funding structure, isolate the high-cost debt, and bring down the 19.1% rate to make the banks more attractive to local strategic investors.
4. Off-Load Government and GAT Shares Strategically
Rather than holding large equity stakes indefinitely, the Ministry of Finance and GAT should consider off-loading shares in three affected banks to settle pension funds that participated in the scheme. However, he cautions that poor performance on the stock market may complicate this approach.
5. Restructure Loan Tenors
Extending repayment periods and offering longer grace periods would allow banks breathing space to rebuild assets without the constant pressure of looming repayments.
6. Independent Audit of the Banking Clean-Up
Dr. Atuahene calls for an independent review of the entire banking sector clean-up, estimated at about GH¢25 billion, as well as GAT’s operations, which reportedly cost about GH¢2 billion. He wants a transparent assessment of whether the 19.1% compounded rate was justified.
7. Create a Dedicated Indigenous Bank Support Fund
Instead of relying on special-purpose vehicles with expensive capital, he proposes establishing a direct indigenous bank support fund, possibly backed by public financial stability resources.
8. Explore Alternative Capital Sources
Banks, he suggests, should seek cheaper capital to buy out GAT’s equity, through mergers, private equity investors, or rights issues, so that ownership can gradually return to private Ghanaian hands.
9. Advocate for Regulatory Forbearance
He recommends engaging the Bank of Ghana for temporary regulatory flexibility for banks undergoing restructuring, especially those still recovering from the effects of the DDEP.
10. Negotiate Clear Exit Strategies
Finally, he calls for structured negotiations with GAT to reduce funding costs and establish a practical exit plan that restores control to indigenous shareholders over time.
Conclusion
Dr. Atuahene maintains that there is an urgent need to reduce the cost of capital and give banks room to breathe.
As of late 2025, the Bank of Ghana indicated that while most banks had stabilised, two indigenous institutions, UMB and Prudential Bank Ghana, remained undercapitalised, underscoring the urgency of reform.
The solution, he says, is not to dismantle GAT entirely but to recalibrate it. The rescue vehicle, he argues, must evolve from a heavy financial burden into a genuine stabilisation tool, one that strengthens, rather than constrains, Ghana’s local banking sector.
