Collapse of 23 financial companies was travesty of justice - Minority
By Benjamin Mensah, GNA
Accra, Sept 4,
GNA - The Minority Caucus of the opposition National Democratic Congress
(NDC) in Parliament on Tuesday criticised the Government for the failure of 23
savings and loans companies, saying it is a travesty of justice.
of the 23 savings and loans companies was a travesty of justice. These savings
and loans companies were strong by the end of 2016 and have suffered from acute
panic withdrawals and systemic impact of the banking sector mess created by
BOG, “Mr Isaac Adongo, MP for Bolgatanga Central, said a NDC News conference in
conference was to throw more light on the financial sector reforms and also
react to “some alleged misleading statements made by government officials.”
indicated that at the time the NDC exited power,”these savings and loans
companies were strong by the end of 2016.”
he said, rather suffered from acute panic withdrawals and systemic impact of
the banking sector mess created by BOG.
“It was the
improper handling of the interconnectedness of these banks to the rest of the
financial systems that has resulted in a melt-down of the financial sector.”
Mr Adongo said
the position of Vice President Bawumia, blaming the former president on the
collapse of the savings and loans companies was laughable, as he explained that
the former President rather began a reform agenda, which started under the NDC
and was built around “carefully crafted inter-related pillars to produce a
solid, well capitalised and globally compliant competitive banking sector.”
On the “Too big
to fail” theory, Mr Adongo said “although the jury is still out there regarding
the pros and cons, the fallouts from the liquidation of Unibank for example has
shown that the cost of liquidation has greatly outweighed the cost of simply
repaying the bank what it was owed by government and doing so promptly.
He blamed the
ruling government for poor implementation of a minimum capital regime, which he
said virtually destroyed Ghana’s financial sector."
unanswered questions with regard to how we spent GH¢23 billions of taxpayers'
money just to collapse financial institutions, create massive unemployment and
turn entrepreneurs into idle hands.
the government be ready to borrow GH¢14 billion to close down banks and a
further GH¢7 billion to close down savings and loans companies as well as GH¢2
billion to shut down microfinance companies, but was not ready to use a
fraction of this amount to pay government’s debts to contractors, which largely
accounted for the slide into insolvency of several cases of the collapsed
Ghanaian taxpayer would have been spared the high cost of this chaotic reform
with Bank of Ghana, if the Bank of Ghana had listened and followed the reform
programme initiated by the NDC”, Mr Adongo said.
He added: “The
people of Ghana are reeling under the unwarranted collapse of scores of
financial institutions and are expecting concrete measures to deal with the
excruciating unemployment caused by the collapse and the loss of livelihoods,
credit and liquidity crunch and dwindling confidence in the financial sector.
Source: GNA Story (https://ghananewsagency.org/economics/collapse-of-23-financial-companies-was-travesty-of-justice-minority--155696)
Published: 2019-09-04 12:17:59
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