The Ghana Association of Banks (GAB) has wholeheartedly embraced the new reforms announced by the Bank of Ghana, describing the measures as prioritizing the greater good of the industry and the economy.
The Association of Banks says the new regulatory measures are aimed at restoring discipline, transparency, and resilience in the country’s financial sector.
The Governor of the Bank of Ghana, Dr. Johnson Asiama, at a post-Monetary Policy Committee (MPC) meeting with the association of banks, announced some new reforms that will be implemented by the banks in no time.
These new directives ranged from corporate governance, non-performing loans, and bank charges, among others.
Reacting to the these sweeping reforms on behalf of member banks, the Chief Executive Officer (CEO) of GAB, John Awuah described the central bank’s new directives, including the publication of willful defaulters’ names, tighter rules on non-performing loans (NPLs), and digital lending guidelines, not as punitive, but as necessary steps to sanitize and strengthen the entire financial ecosystem.
Despite the tough stance of the BoG’s reforms, the GAB remains confident that the changes, far from being a burden, are structured to improve the operational environment for banks and their clients alike.
Among the key measures, John Awuah underscored the planned digital lending guidelines, which aim to regulate the explosion of shadowy online lending platforms, many of which operate without clear oversight.
“Today, there’s this company advertising that we are providing lending on our platform, most of whom we don’t even know where they are, or where they are operating from. And the governor is saying you are going to introduce guidelines to guide the conduct of practitioners in this environment. It helps the industry,” he remarked.
He also backed the controversial directive to clamp down on Non-Performing Loans, calling it a shared responsibility. He believes the new directive will help protect the capital of the industry players from being eaten away by bad loans.
He said, “NPL is a cost and a charge to the bank’s capital level. So if you want to accumulate capital, we should all work together to bring the level of non-performing loans down. The governor says he’s going to work with banks and the system to work out a mechanism that helps us reduce the NPL.”
On corporate governance, he sided with the Bank of Ghana’s reforms that demand stronger local decision-making from international and regional banks operating in Ghana.
This push, he says it’s not political but very logical.
“What the governor is saying is that you cannot put a board in place in Ghana, and decision-making is offshore. The board that you are putting in place, on whom the governor or the central bank has performed fit and proper tests on the directors, they are supposed to be the ones taking the decisions for the regulated entity in Ghana,” he remarked.
Although the new rules may be tough, John Awuah maintains that they have the interest of Ghana’s banking sector financial sector at heart. With both the regulator and the banks united and headed in the same direction, Ghana’s financial sector can be said to be poised for more transparency, efficiency, and a sustainable financial future.
