- The Bank of Ghana says the 2019 revocation of GN Bank’s license is justified and has hinted it will not reinstate it
- It said GN Bank was insolvent at the time of its collapse and had violated several regulatory policies
- He noted that calls for the restoration of the bank’s license are baseless and will not be considered
The Bank of Ghana has revealed why it revoked GN Bank’s banking license in 2019.
In a memo responding to allegations raised by Groupe Nduom Global Chairman Papa Kwesi Nduom, the central bank said the revocation of GN Bank’s license was justified.
Source: Getty Images
He explained that the bank had been involved in several major regulatory violations that threatened its operational stability, making it a risk to Ghana’s financial sector.
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The SC stated that pleas for restoration of GN Bank’s banking license are baseless and will not be entertained under the circumstances.
The central bank cited a statement it issued in August 2019 detailing the reasons for revoking the bank’s license, which included capital adequacy, liquidity, governance and risk management requirements.
It noted that GN Bank has consistently failed to meet minimum capital requirements, raising concerns about its ability to absorb losses and depositor protection.
This was despite the central bank having appointed GN a consultant to help it downsize its operations and raise the minimum required capital.
The efforts of the central bank it didn’t yield muchas GN struggled with liquidity management, which affected its ability to meet customer withdrawal demands.
The SC also said that deficiencies in GN Bank’s governance structure and risk management practices increased its risk exposure and contributed to significant operational deficiencies.
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It stated that GN Bank was insolvent and could not be allowed to continue operating within the country’s financial system.
Dr Nduom starts campaign to bring back his bank
The Global Chairman of Groupe Nduom, Dr Paa Kwesi Nduom, has embarked on a nationwide tour of GN Bank’s defunct offices as part of a campaign to revitalize the bank.
The campaign, dubbed ‘BringBackGNBank’, will see Dr Nduom visit all 300 closed GN Bank branches across the country to inspect the condition of the facilities, engage with customers and reveal to them his plans for restoration of the bank.
Dr Nduom reiterated his concern about the financial exclusion of his former clients after the bank collapse throughout his stops.
He noted that since the bank’s exit in 2019 as part of the Banking Sector Cleanup, no other financial institution has entered the underserved financial markets to allow former clients to join the formal financial system.
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Dr Nduom emotional during the bank tour
YEN.com.gh reported that Dr. Nduom almost burst into tears after visiting one of the numerous defunct GN Bank branches.
When he toured the premises, Dr Nduom could not believe the ruins he saw on his properties, which were worth millions of cedis.
He shared an emotional video to launch a campaign as part of a plan to restart his bank.
Source: YEN.com.gh