Economist and Head of Finance at the University of Ghana Business School, Prof. Godfred Alufar Bokpin has called on the Central Bank to initiate a 15-year plan towards the increase of minimum capital requirements for banks.

The central bank raised the minimum capital requirement to GH¢400 million, equivalent to about US$100 million and commercial banks in the country have up to December 2018 to raise the amount, which represents a 333.3 percent increase from the current minimum capital.

Banks were last recapitalized in 2012, when the BoG asked them to raise their stated capital from GH¢60 million at the time to the current GH¢120 million.

That round of recapitalization led to the consolidation of three banks, The Trust Bank (into Ecobank), Intercontinental Bank (into Access Bank) and Amalgamated Bank (into Bank of Africa).

The call follows concerns raised by local banks over their inability to meet the Bank of Ghana’s (BoG) December 2018 deadline.

They [local banks] subsequently petitioned the president to ensure that the Central Bank gives them more time to raise the amount.

Commenting on the development which the Minority in Parliament warned it would lead to the collapse of local banks, Prof Bokpin opined on Starr Today Friday that in future a strategic plan must be developed to avert agitations being witnessed now.

“…With that it would encourage them [local banks] to mobilise more deposits in order to lend more and generate higher returns appropriate for investors capital in the bank,” he stated.