The government is set to release a bailout of GH¢1.5 billion to customers of the defunct banks.
Finance Minister Dr Mohammed Amin Adam announced over the weekend during a UK Town Hall meeting following a directive from President Nana Akufo-Addo.
Dr Amin Adam emphasised that the president’s directive mandates the disbursement to be completed between now and October 2024.
He underscored that the government prioritises the welfare of the Ghanaian people, clarifying that individuals are accountable for their investment decisions and not the government.
“Ideally, government should not be held responsible for the investment decisions of individuals, but this government is so caring. Mistakes were made and people were not well-informed, and they didn’t know who to consult to be advised, but we also know that the people who are affected are suffering, and we have heard that some people have died and others had to commit suicide.”
“This government is so caring that in the first place, we granted some bailout to all the affected and I want to tell you again that the president has directed that we do another bailout. So between now and October [2024], we will release 1.5 billion Ghana Cedis to the affected people,” he said.
Dr Amin Adam further disclosed the successful conclusion of Ghana’s debt restructuring programme with its official creditors.
He highlighted that the government has effectively restructured its debt of $5.1 billion with these creditors, and has also completed the restructuring of $13.1 billion with Eurobond holders.
In 2017, the governing New Patriotic Party (NPP) initiated comprehensive reforms in Ghana’s financial sector to address instability and systemic risks.
The reform agenda aimed to eliminate unviable financial institutions and enforce new regulatory standards, significantly raising capital requirements for banks.
The government’s aggressive measures led to the closure of nine indigenous banks and over 300 financial firms.
Some of the collapsed banks were consolidated or absorbed by stronger banks. Among the initial casualties in 2017 were Capital Bank and UT Bank, which were sold to GCB Bank in a Purchase and Assumption transaction.
These reforms were designed to reinforce the structural integrity of the banking sector and restore public and investor confidence in the financial system.
However, the implementation of these reforms posed significant challenges, impacting numerous financial institutions and stakeholders within the sector.