Professor Peter Quartey, Economist and Director of ISSER
• The BoG board has been tasked to improve on its sound policies
• This, Prof. Quartey believes will avert a return of the dark days in the banking sector
• He also called for sustainable corporate governance policies and guidelines
Professor Peter Quartey, Head of the Institute of Statistical, Social and Economic Research (ISSER), has admonished the newly constituted board of the Bank of Ghana to build sound and sustainable policies and guidelines.
This, he believes, will aid towards averting a return of what he describes as the ‘dark days’ in the country’s banking sector.
In an interaction with Citi Business News, Prof. Quartey underscored the need for the central bank to improve on its corporate governance policies along with stringent measures to curb a reoccurrence of the ‘dark days’.
“We have in the past seen some undesirable activities or actions that have caused some banks to collapse. We don’t want to go back to the dark days. So, I would expect the new Bank of Ghana board, to also focus on ensuring that there’s soundness within the banking system. And that relates to my next point, good corporate governance. I think the Bank of Ghana has come with all the directives and some documents to guide that. That should be the focus,” the economist said.
He further cautioned against the appointment of personnel for key positions in banks which will culminate in a conflict of interest and, therefore, tasked the BoG board to deepen its resolve in that regard.
“We need good corporate governance practices ensuring that yes people who deserve to be on boards are there and people who are qualified to be there, are there, and also that banks ensure that they employ the right people. The right processes should also be put in place to ensure that there is good corporate governance. You don’t bring your friends, your cronies, your relatives as board members when perhaps they are not qualified. And I think the Bank of Ghana is doing a lot in that respect. So, I expect them to deepen that activity,” he added.
As part of a regulatory crackdown back in 2017, the Bank of Ghana undertook a number of reforms to clean-up the banking sector which was at the time on the brink of collapse as a result of corporate governance breaches and insolvency issues.
The exercise resulted in the revocation of banking licenses which led to a reduction of banks from 34 to 23 including indigenous ones.