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    GN Savings & Loans breached the Foreign Exchange Act; they were disrespectful to BoG – Otabil

    The Director of Communications at the Bank of Ghana (BoG) Bernard Otabil, has dismissed claims by the Chairman of Group Nduom, Dr Papa Kwasi Nduom that the central bank was influenced by former Finance Minister Ken Ofori-Atta to collapse the GN Savings and Loans.

    Mr Otabil stated that GN Saving and Loans violated the financial regulations including the  Foreign Exchange Act of 2006 (Act 723).

    “At the end of the day, it is not in the interest of the central bank or we don’t go out there and say this institution must actually be closed down at all cost.  It depends on how the institution is run, it depends on what the institution itself has stated that it wants to do and on respecting the prudential norms. In fact, let me make it clear that the GN Bank and GN Savings and Loans were actually disrespectful to the central bank.

    “For instance, if you go through the books you will see that there was a transfer of dollars, and pounds and Euros to International Business Solutions which is an institution affiliated to the group network based outside which was in direct breach of the Foreign Exchange Act of 2006 (Act 723). These provisions are there. Our statement of August 16 2019, we stand by that statement and in that statement, we have given all the reasons behind the revocation of the license of GN Savings and loans,” he told TV3’s Paa Kwasi Asare.

    In 2019, the Bank of Ghana revoked the licenses of 23 savings and loans companies and finance house companies, which included the GN Bank. The bank subsequently sought legal action challenging the revocation of GN Savings and Loans’ license by the Bank of Ghana.

    But in January of this year, an Accra High Court presided over by Justice Gifty Addo Adjei upheld the legality of the Central Bank’s decision, emphasizing the institution’s right to revoke the license due to governance deficiencies that rendered GN Savings and Loans unable to meet its debt obligations.

    Dr Nduiom had stated that Mr Ofori-Atta petitioned Cabinet to facilitate the collapse of GN Bank to prevent any political interference.

    “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 recognize that we were providing banking services that increased financial inclusion in Ghana. It didn’t recognize 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 acknowledged that, although the memorandum was presented to the cabinet, the cabinet did not consent to Ken Ofori-Atta‘s request to revoke the bank’s operating license.

    Meanwhile Dr. Nduom has filed for an appeal against the judgement given by Justice Gifty Addo.

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