An Accra High Court has reversed the Bank of Ghana’s (BoG) 2019 decision to revoke the operating licence of CDH Savings and Loans Company Limited, directing both parties to settle the dispute through arbitration.
In a ruling on November 1, 2024, Justice Brew criticized the BoG’s handling of the situation, stressing the constitutional requirement for fair and reasonable administrative actions. The Court found the BoG’s two-week deadline for CDH to liquidate assets and resolve its liquidity issues “unreasonable and unfair.”
The BoG had initially revoked CDH’s licence on August 16, 2019, due to liquidity challenges caused by the company’s inability to sell repossessed collateral, which hindered its ability to meet depositor withdrawals. CDH’s shareholders, CDH Financial Holdings Limited, contested the decision, arguing procedural unfairness and seeking an order to halt further disruptions to its operations pending arbitration. Justice Brew referenced Article 23 of Ghana’s 1992 Constitution, reinforcing that administrative actions must adhere to fairness. This ruling, which overturns the BoG’s licence revocation, strengthens legal protections for businesses facing regulatory action and underscores the importance of due process in Ghana’s financial sector.
The matter now proceeds to arbitration, where CDH and the BoG are expected to negotiate a resolution.
