The Bank of Ghana (BoG) has been declared the winner of the Central Banking Awards for 2019.
The global awards scheme’s research says that BoG has an impressive record of achievements, citing significant reforms in the undercapitalized and poorly managed banking sector of Ghana.
According to the research, Ghana’s apex bank has been able to deal with a complex set of risks that could have caused severe damage to the West African country’s growing economy.
However, Central Baking Awards noted that the BoG still faces a couple of challenges, for which it must recapitalize banks that were previously put into resolution.
“The banking sector also has to digest a large proportion of non-performing loans, and IMF officials have called for closer regulation of the country’s non-bank finance sector.
But the performance of the central bank during the past three years indicates the institution is well placed to meet such challenges”, the report said.
The Bank of Ghana has introduced a series of reforms ever since the takeover of Ernest Addison (featured image) as Governor. Many measures were chased in a bid to ensure a strong financial sector via a raft of reforms implemented over the past two years.
Central Banking Awards’s was seemingly most impresses by Addison’s move to resize the country’s banking sector to improve financial efficiency.
In less than 2 years into his leadership, there are now 23 banks in the country, up from 35 at the start of his tenure. Some banks had mergers and others’ licenses were withdrawn.
“The central bank also took radical action in the microfinance sector, shutting down several hundred small lenders. These moves marked a sharp break with previous policy,” the scheme said.
Another radical move by Addison’s administration which contributed to landing the award occurred in August 2018. The governor said several of the management teams in Ghana’s banks had obtained banking licences through “false pretenses”.
In a first ever move for the central bank of a developing economy, the BoG published a set of principles aimed at encouraging environmentally sustainable and socially responsible practices by the country’s banks.
In October 2018, the Central Bank created a cyber security center to aid the banking sector in dealing with this evolving risk. The slick and interactive nature of the Bank of Ghana’s official website also contributed to winning the award/
The awards will be held on March 19, 2020, in Brussels, Belgium.
Featured Image: Central Banking Awards.