The Supreme Court has validated the Bank of Ghana's (BoG) decision to cancel Unicredit Ghana Limited's operating license.

In a unanimous ruling, the court overturned the Court of Appeal's decision and confirmed the High Court's verdict in Accra, which determined that the BoG did not err in revoking the license, having strictly adhered to legal procedures.

On August 16, 2019, the BoG declared UniCredit Ghana Limited insolvent and rescinded its license to operate as a savings and loans company, in accordance with section 123 of the Banks and Specialized Deposit Taking Institutions Act of 2016 (Act 930).

Hoda Holdings Limited, the majority shareholder of UniCredit, subsequently filed a petition with the Human Rights Division of the High Court, requesting a judicial review of BoG's decision to revoke UniCredit's license and an injunction to prevent the bank from disrupting UniCredit's operations.

Justice Gifty Agyei Addo, presiding over the High Court, ruled that the notice of Unicredit’s license revocation was lawful since it cited section 123 of Act 930 and was based on insolvency, as specified by the same section.

The court further determined that the BoG's action in revoking Unicredit's license was reasonable and neither arbitrary nor capricious, as the records supported BoG's claim of capital insufficiency.

Court of Appeal

Not satisfied with the decision, Hoda Holdings proceeded to the Court of Appeal to challenge the decision, and the court reversed the decision of the High Court.

The Court of Appeal comprising Justices Janapare A. Bartels-Kodwo, Merley Wood and Gbiel Suurbaareh had held that the Bank of Ghana in revoking the license of UniCredit under section 123 of Act 930 should have followed the steps provided in section 16(3&4) of Act 930.

It also held that the failure of the Bank of Ghana to comply with the procedure in section 16(3&4) of Act 930 meant that UniCredit was not given a hearing before its license was revoked.

Supreme Court

Unhappy with the Court of Appeal's ruling, the BoG took their case to the Supreme Court, contending that the decision was not supported by the evidence and that the court had misinterpreted the meaning of section 16(7) of Act 930.

A five-judge panel of the Supreme Court, led by Chief Justice Gertrude Torkornoo and including Justices Mariama Owusu, Prof. Henrietta Mensa-Bonsu, Ernest Yao Gaewu, and Yaw Darko Asare, concluded that extensive communications indicated that UniCredit had received written notice regarding capital deficiencies and liquidity issues, along with proposed actions and a chance to respond in writing.

The Supreme Court stated it was convinced that the records clearly showed a hearing between UniCredit and the BoG occurred before UniCredit’s license was revoked.

“We are also satisfied that the revocation of UniCredit’s license was done in accordance with the stipulated law appearing on the face of the record, and therefore reversed the decision of the Court of Appeal while upholding that of the High Court.”