National Democratic Congress (NDC) Member of Parliament (MP) for North Tongu Constituency, Samuel Okudzeto Ablakwa has criticized the Bank of Ghana’s approach of cleaning up the financial sector.

The vocal legislator chastised the Bank of Ghana (BoG) for not having “factored humane social mitigating principles” in its approach to cleaning the financial sector.

He asserted that: “The public policy option that authorities are pursuing in the much touted financial sector clean-up does not appear to me to have factored humane social mitigating principles. Therefore, in the process; the clean-up is cleaning up jobs, cleaning up indigenous entrepreneurship and cleaning up every confidence in the Ghanaian financial and banking sector.

Mr Ablakwa also questioned the BOG’s apparent inaction in terms of supervision “besides, why do we allow the BoG apparently abdicate all this while only to show up suddenly with a sledge hammer? He wondered.

His comments follows Bank of Ghana’s revocation of licences of eight finance houses and fifteen savings and loans companies last Friday.

These actions according to the Central Bank were taken pursuant to Section 123 (1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930), which requires the Bank of Ghana to revoke the licence of a Bank or Specialised Deposit-Taking Institution (SDI) where the Bank of Ghana determines that the institution is insolvent. The Bank of Ghana has also appointed Mr. Eric Nipah as a Receiver for the specified institutions in line with section 123 (2) of Act 930.

The revocation of the licences of these institutions has become necessary because they are insolvent even after a reasonable period within which the Bank of Ghana has engaged with them in the hope that they would be recapitalized by their shareholders to return them to solvency.