Swiss-based Financial Stability Board (FSB) has appointed Governor of the Bank of Ghana, Dr. Ernest Addison as a Co-Chair of the Regional Consultative Group for sub-Saharan Africa effective July 1, 2019.
Dr. Addison will be working with Governor of the Reserve Bank of South Africa, Lesetja Kganyaga to jointly Chair the Regional Consultative Group of the Financial Stability Board Standing Committee on Supervisory and Regulatory Cooperation.
What is the Financial Stability Board?
The Swiss-based Financial Stability Board FSB is aimed at promoting the reform of international financial regulations and improving supervision of banking operations around the world.
The FSB is established as a not-for-profit association under Swiss law and is hosted by the BIS under a five-year renewable service agreement.
The organization structure of the FSB consists of the Plenary, Steering Committee, Standing Committees, Working Groups, Regional Consultative Groups, Chair, and the Secretariat.
The Board discharges its accountability, beyond its members, through the publication of reports and, in particular, through periodical reporting of progress in its work to the Heads of State and Governments and the Finance Ministers and Central Bank Governors of the G20.
The FSB is established as a not-for-profit association under Swiss law and is hosted by the BIS under a five-year renewable service agreement. The organization structure of the FSB consists of the Plenary, Steering Committee, Standing Committees, Working Groups, Regional Consultative Groups, Chair and the Secretariat.
Regional Consultative Group RCG for Sub-Saharan Africa
The FSB established in 2011 six RCGs, one each for the Americas, Asia, Commonwealth of Independent States, Europe, Middle East and North Africa, and Sub-Saharan Africa region, to expand upon and formalise the FSB’s outreach activities beyond the membership of the G20 and to reflect the global nature of the financial system.
The FSB Regional Consultative Groups are governed by an Operational Framework and provide a structured mechanism for:
– interaction of FSB members with non-members regarding the various FSB initiatives underway and planned;
promoting implementation within the region of international financial policy initiatives; and
– the regional group members to share amongst themselves and with the FSB their views on vulnerabilities affecting the financial system, on FSB initiatives and on other measures that could be taken to promote financial stability.
The Securities and Exchange Commission is investigating money managers for locking up as much as GH¢5 billion in risky investments they’re struggling to retrieve for clients.
The funds are stuck in short-term unlisted bonds, direct private-equity stakes and related-party deals for small- and medium-sized businesses, said Paul Ababio, deputy director-general at the Securities and Exchange Commission.
With efforts to retrieve the money proving futile, the SEC is starting forensic audits to determine how to retrieve money for investors, which may include selling off the fund managers’ assets, he said.
“If part of their portfolio is distressed, we have to understand it to know what solution to deploy,” Ababio said in an interview in Accra. “We’ll look at what can be done for investors — we’ll look at liquidation.”
Cleaning up the nation’s 25 billion-cedis fund management industry became necessary after a recapitalization exercise by the central bank exposed weaknesses in the system. While the drive strengthened the banking industry and reduced the number of lenders by almost a third, the early stages of the programme spurred panicked withdrawals from depositors trying to access their savings, drying up liquidity among fund managers.
Twenty-one firms are being audited, which will be completed by the end of the year, Ababio said.
In all, 9 billion cedis was reported by fund managers as being tied up, of which GH¢4 billion was held in Treasury bill-linked instruments with banks, savings and loans companies or microlenders, he said.
After setting aside GH¢11.2 billion to bailout the banking industry and GH¢925 million to rescue microlenders, the government plans to invest at least 3 billion cedis to help savings and loans companies, the finance ministry said in April. The funds will be used mainly to ease pressures from investments linked to T-bills, Ababio said.
SEC rules forbid fund managers from directly underwriting corporate debt or taking straight private-equity positions, even though they can lend to businesses through reputable financial institutions and invest in a private-equity firm, which then acquires stakes in companies, Ababio said.