The Bank of Ghana (BoG) has announced its intention to roll out a comprehensive and consolidated set of regulatory measures aimed at strengthening the resilience of the nation’s banking sector, enhancing transparency, and aligning operations with the highest international standards.
The Governor of the Central Bank, Dr. Johnson Pandit Asiama, explained that the new agenda would focus on two critical fronts thus Forward-looking reforms to meet evolving global banking standards and Immediate corrective actions to close compliance gaps and address existing weaknesses in the system.
He stated this during a Post-Monetary Policy Committee Meeting with Heads of Banks in Accra, under the theme “Translating Macroeconomic Gains into Sustainable Banking Sector Growth".
Tackling credit risk
Dr. Asiama stressed that all banks would be required to take firm action against deliberate loan defaulters, ensuring that credit obligations are met.
To support this, a Credit Risk Management Directive aligned with the internationally recognised Basel Principles would be introduced to set minimum standards for loan underwriting, monitoring, and provisioning.
In addition, the Central Bank would introduce Bancassurance Directive to improve governance structures within bank-insurance partnerships, Large Exposures Directive to limit concentration risk and prevent excessive exposure to single borrowers or sectors among others.
Enhancing liquidity
On liquidity management, the Governor revealed that a Liquidity Risk Management Directive would require banks to maintain sufficient High-Quality Liquid Assets (HQLA) to cover potential 30-day stress scenarios. This will help ensure that banks remain stable during market shocks.
He also stated that the BoG would close loopholes that have allowed some institutions to artificially reduce their reserve requirements including the misclassification of deposits as borrowings and would issue clear guidelines on the treatment of e-money float accounts to ensure transparency and consistency.
Renewed focus
Dr. Asiama further emphasised a renewed focus on market conduct standards and strict enforcement of the Foreign Exchange Act and Guidelines for Inward Remittance Services.
"Key measures will include Prohibition of unapproved channels for remittance terminations, Ban on FX swaps within remittance operations, No remittance terminations without prior Bank of Ghana approval, Strict adherence to prescribed FX rates to prevent market distortions" he said.
Dr. Asiama stated that these measures are designed to form a single, coherent regulatory framework that not only enforces compliance with existing laws but also positions Ghana’s banking sector to withstand future domestic and global shocks.
The measures he added will enable the banking sector to compete effectively on the international stage while playing a stronger role in supporting sustainable, inclusive economic growth.
