Business mogul and politician, Dr. Papa Kwesi Nduom has flawed arguments by some financial experts justifying the decision by the Bank of Ghana to cut down on the number of commercial banks operating in the country.

According to Dr. Nduom, the justification that Ghana’s economy is not strong enough to have so many commercial banks hence the Central Bank’s effort to downsize the number is hollow and is not based on any scientific research.

Dr. Nduom who is also board chair of GN Bank argued that for Ghana’s economy with the population of almost 30 million to house 34 banks is not any different from other developed jurisdictions like Singapore.

Speaking at the launch of UG-GN Re Pensions and Insurance Fund held at UG Business School Graduate building in Accra, Dr. Nduom faulted such arguments, asserting that Singapore, which has a population of 4.7 million, has over 200 banks.

“Every now and then, I hear some intelligent people say a small country like Ghana, there are 34 banks, and it’s too many. What research did they do? Do you know the population of Singapore, Singapore has a population of 4.7 million people and they have 205 banks.“ he said.

The Bank of Ghana in August 2018 collapsed five banks namely; BEIGE, Sovereign, Construction, UniBank and Royal Bank into the Consolidated Bank Ghana Limited. The decision, according to the governor, was based on a number of infractions by managers of these banks - a claim some have disputed and rather attributed to a mere attempt by the central bank to cut down on the number of banks operating in the country currently. The argument of such people is fueled by the Central Bank's decision to increase the minimum capital requirement for commercial banks from 20 million Ghana Cedis to 400 million Ghana cedis in a matter of less than 5 years.

But scores more have applauded the Central Bank for the move, citing proper supervision and the ability of merged banks to take on bigger contractual agreements that may likely yield more profit.

Finance Minister Ken Ofori-Atta is among the many stakeholders to have defended the Bank of Ghana’s decision.

According to Mr. Ofori-Atta, Ghana’s economy is too small to have 34 universal banks, adding that government will do the needful in ensuring that the country has banks that are strong enough to withstand shocks.