Financial analyst, Sydney Casely-Hayford has commended the central bank for merging five insolvent banks describing it as an â€œinnovativeâ€ move.
â€œI think in so many ways, the way it has been done is innovative because what they [Bank of Ghana] are saying is that for each of the banks that have been taken over, there are specific persons who are going to be responsible for managing those banks,â€ he said on Citi FM/Citi TVâ€™s news analysis programme, The Big Issue on Saturday.
Read: Prosecute and jail culprits of collapsed banks â€“ Casely-Hayford fumes
The Bank of Ghana on Wednesday announced that it has revoked the licenses of five struggling banks and merged them into one it called Consolidated bank Ghana limited.
They include uniBank, Sovereign Bank, Construction Bank, Royal Bank, and Beige Bank.
BoG said some of the insolvent banks obtained their licenses using non-existent capital.
It added that some breached cash reserve requirement, others had negative capital adequacy ratio, and shareholders of some of the banks too engaged in supposed suspicious transactions.
According to Casely-Hayford, the central bank did the right thing.
BoG erred in transferring deposits of collapsed banks â€“ Lawyer
But a private legal practitioner, Yaw Oppong who also spoke on The Big Issue disagreed in part arguing that the central bank erred in transferring deposits of the five indigenous banks to Consolidated bank.
Read: BoG erred in transferring deposits of collapsed banks â€“ Lawyer
â€œUntil you are able with certainty to establish that depositors monies or investments have been at risk, it is for the receiver to continue to perform its functions under the law. On the very day, the receiver was appointed, the deposits which he was going to take possession of were taken away and given to a new bank. That is what has happened in my view.â€
â€œMy point is that once we are all in support of what Bank of Ghana is doing, unfortunately, they also have to act within the law. I am saying that so far as I am concerned, they have erred in certain circumstances,â€ he added.