Following the successful completion of recent banking reforms in Ghana which among order things buoyed the stability of trouble nine commercial banks via recapitalization, the International Monetary Fund (IMF) Executive Board has expressed delight on the performance of the Bank of Ghana (BoG) for job well done.
IMF further lauded both BoG and Ghanaian authorities for returning sanity and confidence in the banking sector.
The commendation, which was contained in a statement after the seventh and eighth reviews under the Extended Credit Facility (ECF) support arrangement for Ghana, the IMF Executive Board said the completion of the financial sector clean-up, as planned, would support the provision of adequate and affordable credit to the economy.
IMF said “The authorities deserve praise for strengthening the banking sector and for resolving nine banks. Completing the financial sector clean-up, as planned, will support the provision of adequate and affordable credit to the economy.”
Business Hilights recalls that the BoG had in 2017, began a comprehensive reform exercise of the banking sector with the objective of cleaning up the sector and strengthening the regulatory and supervisory framework for a more resilient banking sector.
The reform saw the increment of the minimum capital requirement to GH¢400 million to ensure a more resilient banking sector. Besides, the recapitalization saw BoG revoking the licences of seven insolvent banks.
Whereas the completion of Ghana’s banking reforms under the ECF supported arrangement will make available about $185.2 million to the country, the IMF further approved the authorities’ request for a waiver of the non-observance of a few programme targets.
Ghana’s three-year arrangement was approved on April 3, 2015 for about $925.9 million or 180 per cent of quota at the time of approval of the arrangement. It was extended for additional year on August 30, 2017 and is to end on April 2, 2019.
It was further gathered that the arrangement aimed to restore debt sustainability and macroeconomic stability in the country to foster a return to high growth and job creation, while protecting social spending.
IMF in the statement said “The Fund congratulates the authorities for successfully completing the ECF supported programme and stands ready to support Ghana in its quest for economic prosperity.”
