Guaranteed Bank (GN) Bank is set to go into operation soon, as the Court of Appeal has ordered the Bank of Ghana to restore the license.

This comes after nearly a seven-year legal battle, following the revocation of the financial institution's license in 2019, about two years after the then Akufo-Addo-led administration embarked on a banking sector “clean‑up exercise”, i.e., a regulatory overhaul carried out by the Bank of Ghana between 2017 and 2019 to address insolvency, weak governance, and capital shortfalls in the financial system.

The exercise affected the GN bank. They later filed a legal challenge in the High Court in August 2019, but in January 2024, the court presided over by Justice Gifty Addo Adjei ruled against them, after which they pursued an appeal at the Appeal Court, where they received an appellate ruling reinstating their license.

Appeal Court’s ruling

Not only will their license be reinstated to them, but the three-member panel further directed that all assets of the bank be returned to its original owners, ordering the Receiver to hand over management of the company to its previous management team.

GN Bank’s status

GN Bank first suffered a downgrade from operating as a bank to a savings and loans company on January 4, 2019, and was subsequently renamed GN Savings and Loans Company Limited.

Seven months later, on August 16, 2019, under the leadership of former Bank of Ghana Governor Ernest Addison, the central bank revoked the company’s operating licence and appointed Eric Nana Nipah as Receiver.

Unsatisfied with the ruling, the group led by Papa Kwesi Nduom challenged the decision, describing the revocation as unlawful, malicious, and unreasonable.

As part of the reasons why they lost the case against Bog in 2024 was that the court held that governance deficiencies had rendered GN Savings and Loans incapable of meeting its debt obligations and concluded that the company failed to prove it was solvent at the time its licence was revoked.

The judge also stressed that claims of unfairness and illegality in the bank’s license revocation by the BoG were in accordance with law and were in consonance with Article 130 of the 1992 Constitution.

The court further rejected allegations of discrimination, noting that other financial institutions affected by the banking sector reforms were subjected to similar regulatory actions.

Despite the ruling, GN maintained that the revocation breached existing laws and appealed the decision, leading to the latest judgment by the Court of Appeal.

Nduom allegations against the then govt

The Global Chairman of Groupe Nduom, Papa Kwesi Nduom, in July 2024, alleged that the Bank of Ghana (BoG) intentionally misrepresented the debt value of the GN Bank to facilitate its closure.

Dr Nduom disclosed that a debt of GH¢2.2 billion was allegedly reduced and recorded as GH¢30 million to portray the bank as unstable and at systemic risk.

The Groupe Nduom chairman made the remarks during an inspection of a former GN Bank office at Roman Hill in Kumasi.

He also maintained that the bank had been unfairly shut down.

"People who said we only have about 30 million cedis, I know they did it deliberately because the same people, a year before, said they counted 640 million Ghana cedis.

“Meanwhile, they have seen a report by an independent auditor, which confirmed that the value of our project was 2.2 billion Ghana cedis. And so why did they use this to collapse the GN bank?”

Dr Nduom asked, according to a report by myjoyonline.com.

Despite the bank's accusations and legal challenges against the BoG's decision to revoke its licence, an Accra High Court upheld the central bank's action.

The court found that the BoG had not breached any laws.

Dr Nduom accuses Former Finance Minister Ofori-Atta

Dr Nduom, in June 2024, also alleged that former Finance Minister Ken Ofori-Atta petitioned the Cabinet to facilitate the collapse of the now-defunct GN Bank to avert any political interference.

According to Nduom, the memorandum by the former Finance Minister requested that the Cabinet revoke GN Bank's banking license.

He alleged that Ofori-Atta's motive was to neutralise the bank and prevent it from being used to politically antagonise the ruling government.

“I have with me here a memorandum submitted by the Minister of Finance at that time, Mr Ken Ofori-Atta, asking Cabinet to agree for GN Bank to be collapsed, for its license to be taken. This memorandum didn’t consider that this bank was the biggest bank with the widest distribution in Ghana.

“It didn’t recognise that we were providing banking services that increased financial inclusion in Ghana. It didn’t recognise that we were supporting financial development and economic development in Ghana.

“It just said, these people are causing us problems, and therefore it might affect our political chances, so let’s shut it down,” Dr Paa Kwesi Nduom claimed in a viral video shared on X, formerly Twitter.

He revealed that although the memorandum was presented to the cabinet, there was no consent to Ken Ofori-Atta's request to revoke the bank's operating license.