Tag: Bank of Ghana

BoG Says Banking Sector Profits Up as Return on Equity Rises to 32.2%
Business & Economy

BoG Says Banking Sector Profits Up as Return on Equity Rises to 32.2%

Ghana’s banks remain solid, posting a capital adequacy ratio of 18.28%, nearly…

2 Min Read
BoG Increases Biennial Licence Renewal Fee for Foreign Exchange Bureaux
Business & EconomyMarkets

BoG Finalises Crypto Regulation Bill, Targets Formal Rules by December 2025

The Bank of Ghana has finalised the cryptocurrency regulation bill, aiming to…

3 Min Read
Trust Is the New Currency of Banking — BoG Governor Urges Industry to Build Credibility Through Digital Integrity
Business & Economy

BoG Governor Urges Banks to Turn Stability into Innovation

BoG Governor Dr. Johnson Asiama urged banks to transform Ghana’s financial stability…

2 Min Read
Trust Is the New Currency of Banking — BoG Governor Urges Industry to Build Credibility Through Digital Integrity
Business & EconomyMarkets

Trust Is the New Currency of Banking — BoG Governor Urges Industry to Build Credibility Through Digital Integrity

BoG Governor Dr. Ernest Addison urged banks to embed trust and integrity…

4 Min Read
Digital Banking Growth Brings Convenience but Also Fraud Risks, Says Deputy Governor
Business & Economy

Digital Banking Growth Brings Convenience but Also Fraud Risks, Says Deputy Governor

Ghana’s digital banking improves access and convenience but increases fraud risks. Bank…

3 Min Read
GCB’s Dividend Delay Raises Questions of Corporate Governance & Threatens Investor Confidence Following GCB Bank PLC’s announcement that it cannot proceed with its approved dividend payment, an expert is revealing that the issues raise serious questions of corporate governance and investor confidence. A notice by GCB Bank announced to shareholders that the Central Bank has cited it for regulatory breaches and hence cannot grant approval for dividends to be paid for last year, despite the approval by the shareholders at GCB’s Annual General Meeting in May this year. The BoG’s decision, GCB says, is linked to a regulatory issue over the reclassification of restructured cocoa bills into bonds, which has put the bank in temporary breach of the single obligor limit. This is a key that caps exposure to a single borrower. While GCB insists this is a compliance matter and not a sign of financial strain, the news lands at a sensitive time for Ghana’s financial sector. The banking industry is still adjusting to the aftereffects of the Domestic Debt Exchange Programme (DDEP), which changed how many institutions account for government-related debt instruments. The Rule Banking and financial consultant, Dr. Richmond Atuahene, explains in an interview with The High Street Journal that the Single Obligor Limit rule can be found in Act 930 of the Banks and Specialised Deposit-Taking Institutions Act 2016. Per the law, it refers to the maximum amount of credit exposure a bank or specialized deposit-taking institution can have to a single customer or obligor. According to the Act, banks are not allowed to exceed a certain percentage of their net own funds to a single obligor, an individual or a company. This is to limit the risk of exposure to a single customer. Some key aspects of the single obligor limit include - Purpose: To reduce systemic risk and encourage diversification - Limit: A maximum of 25% of net own funds to a single counterparty - Objective: To prevent banks from being overly exposed to a single borrower or group, thereby protecting depositors and maintaining financial stability This limit is an essential component of Ghana's banking regulations, aimed at ensuring the soundness and stability of the financial system. The Corporate Governance Concern Dr. Atuahene maintains that for GCB Bank to breach the rule signals weak corporate governance. He cannot fathom why the board members sat aloof for this to occur, knowing very well the existence of the rule. He explains that the “weak corporate governance” has made GCB excessively exposed to the COCOBOD. To him, the high exposure creates what he refers to as seismic risk, meaning that in the event of the collapse of COCOBOD, GCB will be highly affected. He therefore indicated that they cannot pay dividends to shareholders as directed by the Bank of Ghana because it has flouted the law. To him, the regulator is just applying the law by cracking the whip. “It means the corporate governance was bad. Because if the directors were up and doing, they would have seen it earlier and possibly notified the BoG for remedies,” he said. The Impact on Investor Confidence The question now is whether this directive for the bank to halt dividend payouts will dent investor confidence or simply be viewed as a procedural bump. For some investors, dividend payouts are a key indicator of a bank’s strength and reliability. The postponement, emanating from breaches of law, could cause a few to reassess their positions. Others, however, see it as a sign of regulatory discipline, not weakness. Investors will be watching how quickly GCB resolves this. The response time, not just the problem itself, will shape perceptions. GCB says it is “actively engaging” with regulators to restore full compliance and proceed with the dividend as soon as possible. The bank has also reaffirmed its commitment to financial soundness and the protection of shareholder value. For now, the market remains calm, but beneath that calm lies curiosity, and perhaps a little concern.
Business & Economy

GCB Bank’s Dividend Delay Raises Questions of Corporate Governance & Threatens Investor Confidence

GCB Bank’s delayed dividend payment, halted by the Bank of Ghana over…

5 Min Read
Enhancing BoG's Independence for Economic Growth Post-IMF Bailout: Dr. Atuahene's Insights
Business & Economy

BoG Bills Auction Raises GH¢7bn at 21% Interest Threatening Gov’t’s Lower-Yielding T-Bills

The Bank of Ghana raised GH¢7 billion at 21.46% in its latest…

2 Min Read
BoG Barrs GCB Bank from Paying Dividend Over Regulatory Breach Despite Approval at AGM
Business & Economy

BoG Barrs GCB Bank from Paying Dividend Over Regulatory Breach Despite Approval at AGM

The Bank of Ghana has halted GCB Bank’s approved dividend payment, citing…

4 Min Read
News

Ghana Must Address Economic Fragility with Lasting Reforms — Policy Analyst

Policy Analyst Stephen Apolima urges Ghana to address its deep economic fragility…

3 Min Read
Despite lower interest rates and a stabilized exchange rate, Ghana’s liquidity constraints limit borrowing, with Prof. Bokpin urging focus on jobs, growth, and real economic stability
Business & Economy

BoG’s Obsession with a Low Exchange Rate Is Killing the Economy – Prof. Bokpin

Prof. Godfred Bokpin says the Bank of Ghana’s obsession with a low…

3 Min Read
T-Bills Hit 87% Oversubscription, Reinforcing Investor Confidence, But Yields Move in Mixed Directions
Business & Economy

T-Bills Market Slumps After Impressive Rally, Record GHC3.65Bn Shortfall Despite Hike in Rate

After last week’s GHC1.24 billion oversubscription, Ghana’s T-Bills market slumped with a…

3 Min Read
Without Proper Measures, Fintechs & Cryptos Could Pose Serious Risks to Ghana's Financial Sector – Governor
Business & Economy

Without Proper Measures, Fintechs & Cryptos Could Pose Serious Risks to Ghana’s Financial Sector – Governor

BoG Governor Dr. Johnson Asiama has warned that fintechs and cryptocurrencies could…

4 Min Read