• About Us
  • Contact Us
  • Photo Gallery
  • Privacy Policy
  • Terms of Use
  • Citi TV
Wednesday, February 1, 2023
Citinewsroom - Comprehensive News in Ghana
  • Home
  • News
  • Business
  • Sports
  • Showbiz
  • Coronavirus
  • Infographics
  • Livestream
  • Videos
No Result
View All Result
Citinewsroom - Comprehensive News in Ghana
  • Home
  • News
  • Business
  • Sports
  • Showbiz
  • Coronavirus
  • Infographics
  • Livestream
  • Videos
No Result
View All Result
Citinewsroom - Comprehensive News in Ghana
No Result
View All Result

BoG revokes licenses of 347 microfinance, 39 microcredit institutions

Delali Adogla-BessabyDelali Adogla-Bessa
May 31, 2019
Reading Time: 2 mins read
Dr. Ernest Addison, BoG Governor

Dr. Ernest Addison, BoG Governor

ShareShareShareShare

The Bank of Ghana (BoG) has revoked the licenses of 347 microfinance institutions in the country.

Thirty-Nine (39) microcredit institutions have also had their licenses revoked by the central bank.

Of the microfinance institutions affected, 192 of them were insolvent while the remaining 155 had ceased operations.

Following the revocation of the licences of these institutions, a total number of 137 microfinance companies remain active.

The BoG in a statement explained that these actions were to “protect the stability of the financial system and to protect affected depositors.”

“The revocation of the licenses of these institutions is to get rid of insolvent and dormant institutions that have no reasonable prospects of rehabilitation and have denied depositors access to their deposits, thereby constituting a threat to the stability of the financial system.”

The BoG took these actions in line with section 123 (1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930).

This mandates the central bank to revoke the licence of a bank or Specialised Deposit-taking Institution (SDI) “where the Bank of Ghana determines that the institution is insolvent or is likely to become insolvent within the next 60 days.”

The BoG has also appointed Eric Nipah as Receiver for the specified microfinance institutions, also in line with section 123 (2) of Act 930.

The government has made funds available to enable the Receiver to pay depositors “after their claims are validated.”

“In line with the hierarchy of creditor claims set out under Act 930, other creditors of the failed institutions will be settled by the Receiver upon validation of their claims and to the extent that the Receiver is able to realise value from the remaining assets of these institutions.”

State of microcredit sector

The revocation of the licences of the 39 microcredit institutions was mainly due to “severe undercapitalization, poor lending and risk management practices, and poor corporate governance practices.”

“Despite notices issued to the affected institutions by the Bank of Ghana over the last few years requiring remediation of identified regulatory violations and other supervisory concerns, these institutions failed to address the issues brought to their attention.”

Following the revocation of the licences of these microcredit institutions, a total number of 31 microcredit companies remain.

The BoG says going forward, it will be strengthening its regulatory and supervisory framework, and promoting confidence in the microcredit sector.

It said it has notified the Registrar of Companies at the Registrar General’s Department of the revocation of these licences “and has requested that the Registrar commence winding-up proceedings against these companies.”

GHc900 to sanitise microfinance sector

The BoG has already indicated that it has secured GHc900 million to begin sanitising the country’s struggling microfinance sector.

About 705,396 depositors of distressed or collapsed microfinance companies and rural and community banks (RCBs) risked losing some GHc740.5 million without some form of intervention.

The Governor of the BoG, Dr Ernest Addison has indicated that GHc 7 billion will be needed for a full clean-up.

 

Share1437TweetSendSend
Previous Post

Poor coordination led to confusion over rosewood seizure – Forestry Commission

Next Post

Mortuary workers’ strike enters day three

Related Posts

Top Stories

Enforce laws on dollarisation – Economist to BoG

January 31, 2023
Top Stories

Banking sector profit drops by almost 20% – BoG

January 30, 2023
Top Stories

Bank of Ghana increases Monetary Policy rate to 28%

January 30, 2023
Top Stories

Govt defaults in cocoa bill payment; BoG, COCOBOD others agree to roll over maturing investments

January 23, 2023
Business

Retail customers to be paid with COCOBOD’s deposits over cocoa bills default 

January 23, 2023
Top Stories

There’s enough gold to exchange for oil – BoG

January 17, 2023
Next Post

Mortuary workers' strike enters day three

TOP STORIES

National Rental Assistance Scheme feasible – Housing Ministry tells naysayers

February 1, 2023

Anwiafutu: Body of boy retrieved in mining pit after drowning in river

February 1, 2023

Collection of property rates goes cashless

February 1, 2023
Load More
ADVERTISEMENT
Citinewsroom – Comprehensive News in Ghana

CitiNewsroom.com is Ghana's leading news website that delivers high quality innovative, alternative news that challenges the status quo.

Archives

Download App

Download

Download

  • About Us
  • Contact Us
  • Photo Gallery
  • Privacy Policy
  • Terms of Use
  • Citi TV

© 2021 All Rights Reserved Citi Newsroom.

No Result
View All Result
  • Home
  • News
  • Business
  • Sports
  • Showbiz
  • Coronavirus
  • Infographics
  • Livestream
  • Videos

© 2021 All Rights Reserved Citi Newsroom.

We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept All”, you consent to the use of ALL the cookies. However, you may visit "Cookie Settings" to provide a controlled consent.
Cookie SettingsAccept All
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checkbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checkbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT