President Nana Addo Dankwa Akufo-Addo on Tuesday said sanity has been restored in the Banking Sector of the country.
He said the Bank of Ghana, under new leadership, intervened in the banking crisis and, in the process, had saved the banks involved and 4.6 million depositors’ funds.
President Akufo-Addo, who was speaking at the last State of the Nations Address for his first term, stated that the government had invested GH¢21 billion to fund the cleaning up exercise.
He said the Government was committed to paying all validated claims, saying, “I expect the process to be completed soon after the courts grant the liquidation orders for the remaining failed fund management companies.”
He noted the exercise had helped built a more robust financial and banking services sector to finance the rapid development of the country.
“There are painful lessons that we all have to imbibe from this debacle. Probably, the most difficult problem the government met on coming into office was the state of the banking and financial sector,” he said.
“Many of our banks were in distress, and had been kept on unsustainable and artificial life support by the Central Bank. The supervisory agencies were, unfortunately, not performing their duties, and the governance and management structures of many of the banks were clearly not adequate”.
He described the operations of many of the finance houses as glorified ponzi schemes that lured many depositors into these schemes.
President Akufo-Addo said many people got attracted to the unsustainable high interest rates that some of the financial houses were offering.
“In all financial dealings, we have to accept what the experts tell us that, whenever whatever on offer sounds too good to be true, it invariably ends up being untrue and unsustainable,” he said.