The Bank of Ghana (BoG) has secured a new electronic surveillance software as part of measures to boost its analytical advisory role in the banking and financial sector.
The software is to among other things, help in obtaining data in the supervision and monitoring of financial reports by banking institutions.
At a virtual conference organized by the Faculty of Law of the Ghana Institute of Management and Public Administration (GIMPA) on Thursday, August 6, 2020, Governor of the Central Bank, Dr. Ernest Addison said the move is to ensure accurate financial information to eliminate impediments that have the potential of leading to crisis in the banking sector.
“The Bank of Ghana has invested in new state-of-the-art surveillance software. This new electronic surveillance system will help capture supervisory data from regulated institutions more accurately and prevent the high incidence of misreporting witnessed with the failed institutions.”
Dr. Addison who was speaking under the theme, the Banking and Financial Sector Crisis in Ghana; Towards Sustainable Reform also added that “ the software will enhance the analytical capacity of the supervision teams and help with more effective reporting of supervisory concerns for appropriate and timely interventions”
Meanwhile, the Bank of Ghana has also increased human and financial resources to its departments that regulate and supervise the financial sector to enable them to function well.
COVID-19 on banking sector
Touching on the impact of the COVID-19 pandemic on the banking sector, Dr. Addison mentioned: “The COVID 19 pandemic has presented an unprecedented negative shock to the economy and a major test of the resilience and robustness of the banking sector. The Bank of Ghana has risen to the challenge with policy measures to protect the financial system and support the real economy. On March 20, 2020, the Bank of Ghana’s Monetary Policy Committee (MPC) announced a series of measures designed to mitigate the impact of the COVID-19 pandemic shock.”
According to the Governor, the benefits of these measures will be enormous.
“Banks will have to be vigilant and upgrade their capabilities, improve governance and risk culture, and we are optimistic that with this approach, we will build a robust, resilient and capable financial sector to support Ghana’s Beyond Aid Agenda.”, Dr. Addison advised.
The Bank of Ghana in August 2017 after an aggressive assessment embarked on a cleanup exercise in a bid to restore confidence in the banking and specialized deposit-taking sectors and save financial institutions that posed serious risks to the sector.
In all, the licenses of nine universal banks, 347 micro-finance companies, 39 micro-credit companies or money lenders, 15 savings and loan companies, eight finance house companies, and two non-bank financial institutions were revoked.
This affected about 4.6 million depositors whose monies could have been lost completely had the regulators not taken the action.
SEC boss highlights impact of COVID-19 on securities sector
Also speaking during the virtual event, Rev. Daniel Ogbarmey Tetteh, the Director-General of the Securities and Exchange Commission (SEC) also highlighted the impact of COVID-19 on the securities industry.
He said the sector recorded mixed impact across the board pushing players to adopt different strategies to stay afloat.
“We have noticed a mixed impact of COVID-19 on the industry. If you take the trading platforms, while volume and value of trading on the Ghana Stock Exchange has been hit within this period, that of the Ghana Commodities Exchange has been adversely affected. In the case of assets under management, there seems to be a balance between withdrawals and new investments.”
Rev. Ogbarmey Tetteh said.
“What is also clear is the need for investment in ICT driven platforms. As someone has said, the new normal means work is no longer a place you go but what you do. We expect our licensee to invest more in ICT and also take note of the potential threat of such platforms. We also expect our licensee to rely on ICT to ensure adequate disclosure and engagement with the investing public. As a commission, we recently issued guidelines on holding annual meetings for the guidance of listed companies and market intermediaries and we expect that the firms will retain the option of using virtual platforms in addition to the traditional meetings. We have also given directives to the market to do electronic submissions to the commission,” the SEC Director-General added.