Governor of the Bank of Ghana (BoG), Dr. Johnson Pandit Asiama, has called for stronger enforcement of Ghana’s insolvency and beneficial ownership laws, emphasising the judiciary’s critical role in maintaining financial stability and ensuring timely resolution of distressed companies and banks.
Delivering the keynote address at a Judicial Sensitisation Programme organised by the Office of the Registrar of Companies, Dr. Asiama said the country’s financial and corporate systems depend on a resilient insolvency regime supported by consistent judicial interpretation and swift decision-making.
He warned that delays in insolvency and restructuring cases could erode asset values and threaten enterprise viability, ultimately undermining confidence in the financial system.
Dr. Asiama said the Corporate Insolvency and Restructuring Act (CIRA), 2020 (Act 1015), and the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930), provide the necessary frameworks to guide corporate restructuring and bank resolution processes.
He noted that these laws have positioned Ghana to handle financial distress more efficiently while protecting the interests of depositors, investors, and the broader economy.
According to him, a robust insolvency regime is essential to “stabilise companies, restructure debt, and promote fair market practices.”
He explained that Act 1015 enables administrators and restructuring officers to guide distressed firms through recovery, while Act 930 empowers the Bank of Ghana to intervene in weak financial institutions through early corrective actions, administration, or receivership.
The Governor outlined common causes of insolvency in Ghana’s financial institutions, citing weak governance, creative accounting, insider dealings, poor risk management, and misuse of depositor funds. He stressed that the Bank of Ghana remains proactive in monitoring financial institutions to prevent such failures and ensure compliance with prudential regulations.
Dr. Asiama further highlighted that when banks or specialised deposit-taking institutions (SDIs) become insolvent or are likely to fail, Sections 107 and 123 of Act 930 empower the central bank to revoke their licences and appoint receivers to safeguard depositors’ interests. He cautioned that judicial reversals of regulatory actions without clear findings of procedural breaches could create legal uncertainty and destabilise financial markets.
Referencing international best practices under the Financial Stability Board (FSB), Dr. Asiama noted that resolution laws should not allow court actions that reverse measures taken by regulators acting within their legal mandate and in good faith. Instead, affected parties should seek redress through compensation mechanisms to protect the overall integrity of the financial system.
He acknowledged the Supreme Court’s ruling in the GN Bank case (Dr. Papa Kwesi Nduom & Others v. Bank of Ghana & Others), which reaffirmed judicial oversight in matters of administrative justice, but urged courts to exercise circumspection in insolvency cases to avoid disruptions to resolution processes.
Dr. Asiama announced that Act 930 is currently under review to strengthen the Bank of Ghana’s legal authority in bank resolution, clarify its mandate, and enhance Ghana’s overall financial stability framework.
He commended the Office of the Registrar of Companies for leading stakeholder sensitisation on insolvency and beneficial ownership laws, noting that such training for judges will improve coordination between regulators and the judiciary in enforcing corporate accountability.
He concluded by reaffirming the BoG’s commitment to promoting economic growth, price stability, and financial soundness, stressing that effective collaboration among regulators, the judiciary, and corporate actors is key to implementing insolvency laws that protect the economy and strengthen investor confidence.
