Vice President of policy think tank Imani Ghana, Kofi Bentil, has debunked myths of a meltdown in the nation’s financial sector following the recent collapse and merger of some banks and panic withdrawals.
Mr Bentil believes that, contrary to opinions that Ghana’s financial system is in crisis due to recent developments, the nation’s financial space is “very stable” and capable of growth., a situation he says “we have to be proud of”.
“Our financial system is very stable. We have had in the past year some problems with the banking system. In certain places, the domino effect will just crash everything. It happened in the United States and it was catastrophic. Some people have lost everything but we have not had a catastrophic meltdown of our financial system. It’s something we have to be proud of,” he said.
In an address at Media General’s Economic Dialogue Series in Accra, on the theme “Has Ghana learnt any lessons and what is the way forward?”, Mr Bentil argued that despite the challenges which have forced banks into insolvency, the current crisis is manageable when regulators are empowered to enforce the laws.
He explained that regulatory bodies in Ghana tend to have a minimalist view or interpretation of their powers. This, he said, is as a result of a constitutional provision that restrains these bodies from clamping on businesses engaged in unlawful activities and dealings.
He cited banking and mortgage crisis that have taken place in advanced economies like the United States despite their sophisticated structures and high level of financial education.
Mr Alhassan Andani, president of the Association of Bankers,said banks have been at the center of phenomenal growth and the spread of global wealth the world has seen. He added that all activities ranging from household aspirations, government aspirations and expectations of large corporate companies are all reflected by banks.
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Mr. Andani assured the public that the central bank is committed to correcting the ills of banks that have faltered.
“The right authorities are at work and any restitution and consequence management will be appropriately addressed”
The President of the Association of Banks expressed his full confidence in the financial sector and urged the public to allay their fears.
“The banking sector in Ghana is absolutely strong. This is to say all of the issues in the industry doesn’t impact 10% of our wealth and there hasn’t been any real systemic impact. Household deposits, a company’s ability to borrow and the need for them to move funds between themselves internally and externally is still very safe and growing. Whatever we are going through can only make us better,” he noted.
Source: tigpost.co