There is no discrimination in issuing bank licences - BOG
Accra (Greater Accra) 01 June 2001
The Bank of Ghana on Thursday denied any discriminatory policies in the issuance of licences to banking and financial institutions, saying it grants licences only to promoters who meet its requirements in full.
Addressing a Press Conference in Accra, the first Deputy Governor of the Bank, Mr Emmanuel Asiedu-Mante, explained that the bank insists on the requirements to ensure the integrity of the financial system and guarantee the safety of depositors' monies.
The press conference was to explain the bank's licensing requirements and to also debunk impressions of discriminatory practices in licensing procedures published by "The Independent" newspaper.
The paper carried in its May 24 edition a headline, "Foul Play at Bank of Ghana" in which it sought to create the impression that the bank discriminates in issuing licences to applicants.
It indicated that foreign and local investors interested in establishing banking institutions would want a clear signal from the government and the Central Bank Governor that no such practices exist.
Mr Asiedu-Mante said like all regulatory bodies worldwide, the bank has laid- down procedures and processes it adopts to grant licences to individuals and institutions and quoted sections of the Banking Law, 1989 (PNDC L225) to support its position. The law stipulates, among other things, that only companies incorporated in the country could carry on the business of banking, and application for licence should be submitted to the Bank of Ghana, together with directors' particulars and a feasibility report, including a business plan and projections for the first five years.
In addition, the promoters must also satisfy the Central Bank's minimum paid up capital for the various types of banking business - Ghanaian Banking business 25 billion cedis, Foreign Banking business 50 billion cedis and Development Banks 70 billion cedis.
Mr Asiedu-Mante said the bank determined the minimum capital requirements based on economic conditions, establishment expenses and initial working capital and initial capital requirements in other jurisdictions.
"These levels are periodically reviewed in accordance with changing economic circumstances," he emphasised.
Mr Asiedu-Mante said in reviewing an application for licence, the Central Bank ensures that the proposed mission and objectives of the bank conform with the country's general economic and financial policies and its social and economic benefits to Ghanaians.
It is also expected that the directors, key management personnel and other staff must satisfy the "fit and proper person" criterion as regards technical competence and experience, moral uprightness and integrity.
"It must be emphasised that the Bank does not issue a banking licence to any person or group of persons who partially meet the above conditions," he said.
Mr Asiedu-Mante said there is no time limit on when a licence could be granted, adding, however, that the promoters' quick response to the Bank's queries might help speed up the process.
He said there are currently six applications awaiting a review, stressing, however, that the existence of an application does not mean that they will be granted licence.
Asked whether the 17 banks in the system are not enough, Mr Asiedu-Mante said he did not believe that the number of banks now has reached saturation point yet.
He explained that the Central Bank's research indicates that there is a lot of money outside the banking system that essentially must be mopped up and this requires more banks to do so.
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Accra (Greater Accra) 01 June 2001
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