International firm to conduct special review of NIB’s financial condition – IMF

A special review of the National Investment Bank’s financial condition, asset quality and business model will be performed by an international, independent and reputable firm, with the terms of reference to be determined in collaboration with the staff of the International Monetary Fund.

In its Second Review of the Extended Credit Facility programme for Ghana, the Fund said an overarching restructuring plan will be prepared, addressing among other things, necessary changes to the business model, risk management, and corporate governance by the end of March 2025.

This will ensure that capital injections are used efficiently and that sustainability is restored.

The strategy to resolve NIB’s financial and operational problems was approved by Cabinet in May 2024. This strategy envisages a series of capital injections by the government—with the first injection completed in May 2024—to address immediate liquidity needs and capital shortfalls.

The IMF also said the government has endeavored to address the recurring financial problems at state-owned banks.

“State-owned banks other than NIB are also facing financial difficulties, not just from the DDE [Domestic Debt Exchange] but also from longer-standing problems in business models and risk management that have allowed the accumulation of high NPLs. The government will conduct a diagnostic review of such challenges—covering business models, governance, risk management, and legal framework—and devise a strategy to reform this sector (end-April 2025)”.

“In the meantime, the strong measures adopted to address NIB’s challenges will also serve as a guide to strengthen other key public banks”, it explained.