Bank of Ghana to Challenge High Court Ruling on CDH Savings and Loans License Revocation
The Bank of Ghana (BoG) has confirmed plans to appeal a High Court ruling that reversed the regulator’s decision to revoke CDH Savings and Loans’ license.
Per reports, the central bank intends to challenge the judgment at the Court of Appeal, maintaining that the initial revocation was a necessary step to uphold financial stability.
The High Court, presided over by Justice Nana Brew, found BoG’s directive for CDH to liquidate assets to address solvency and liquidity issues as “unreasonable and unfair.”
However, the ruling did not acknowledge the multiple warnings issued by BoG, advising CDH Savings and Loans to rectify its Capital Adequacy Ratio (CAR), which had consistently fallen below the required threshold.
Despite CDH’s prolonged liquidity challenges and perceived systemic risks, the financial institution reportedly did not comply with these directives.
Hence, the BoG’s final action—a two-week notice for asset liquidation—was the culmination of several regulatory measures offered before the license revocation.
BoG, citing the Banks and Specialized Deposit-Taking Institutions Act (Act 930), asserts that the revocation process was “regularly and lawfully done.”
The Central Bank reiterated that its actions were neither “unfair nor unreasonable,” emphasizing that similar license revocations during the banking sector cleanup exercise had previously been upheld by both the High Court and Supreme Court.
The BoG intends to argue in the Court of Appeal that its intervention was crucial to mitigating systemic risks and maintaining confidence in Ghana’s financial sector.
The BoG must not think all is well and everything about it is sacrosant. Its therefore ridiculous for the bank to assert that because the courts have upheld some of the reasons that the bank as supervisory body made against some financial institutions in past then every decision it makes the court should okay it.
The BoG penchant for withdrawal of licences without public warning is a disturbing issue. Until recently people just lost money because of bank of Ghana unnecessary and unwanted warnings.
The bank inability to check depreciation of the Cedis makes the bank a waste and if license is to be revoked because of performance then the central itself would have failed its own standard long time.
The current financial maladies in Ghana is a complete testament to the BoG under performance.
The institution must be reformed immediate. The reforms must include establishing separate board for the bank from management, a different body to supervise all financial institutions including Bank of Ghana.