An economist with the Department of Economics at the University of Cape Coast, Dr. William Godfred Cantah has urged the central bank to reinforce its supervisory role in the banking sector.

According to him, the move will enhance confidence in the sector and other financial institutions and services operating in the country.

Making the call during a roundtable discussion, Dr Godfred Cantah recounted the magnitude of impact as a result of the banking sector clean-up undertaken by the Bank of Ghana in 2017.

“The impact of the banking sector clean-up comes in several folds. It also affected the confidence of many people in the banking industry. But it is good that government took up the cost of depositor’s funds. My only challenge was with the approach the government took to tackle the issue. We had no choice done to tackle the issue. If we had not tackled the issue, the economy would have been worse off today,” he intimated.

He added, “Now inefficiency is a major problem in our banking industry and they need to deploy technology that would reduce their cost of operation. Also, the Bank of Ghana should be more intrusive in its supervision. They should be looking for problems to solve before they escalate so that we don’t experience what we experienced in the last three years. We must see the problems before they come off.”

In 2017, the Bank of Ghana conducted a regulatory crackdown of banks and financial institutions in the country. The move resulted in the collapse of some nine indigenous banks and over 400 deposit-taking institutions and fund management firms.

The central bank explained the crackdown was based on poor business practices and weak capital positions of the banks and financial institutions.