Financial analyst Joe Jackson says claims that the financial sector reforms being undertaken by the Central Bank is doubtful.

According to him, rural banks have a lot of challenges too and must undergo reforms.

“There are some issues in the rural bank sector as well. The rural banks need to be cleaned as well. The regulator should act quickly,” he told Francis Abban on Monday.

The comment comes on the back of the latest clean up in the savings and loans industry which saw about 23 of them including financial houses going down last Friday.

The Bank Of Ghana said the firms had severe liquidity challenges which had rendered them insolvent.

The bank in a statement said the actions “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.”

Assurance to customers

BoG has also assured that funds are available to pay customers of the 23 finance houses and savings and loans companies whose licences were revoked today.

The Central Bank says it has provided funds to ensure that the Receiver of the financial entities, whose licences have been revoked, will pay the affected customers.

“The Government has made available funds to enable the Receiver to pay depositors of the savings and loans companies and finance houses after validation of their claims. Other creditors of the failed institutions will be settled by the Receiver in line with the hierarchy or priority of creditors’ claims set out under Act 930,” the Bank of Ghana said in a statement.