President of the Republic of Ghana, Nana Addo Dankwa Akuffo-Addo, has justified the 2017 banking sector cleanup, which led to over 6,000 job losses, saying it was “an act of necessity.”
The Capital Bank and UT Bank were the first casualties of the cleanup, leading to their sale to the Ghana Commercial Bank (GCB) in a Purchase and Assumption transaction in 2017, a year after President Nana Addo entered his first term of office.
The Bank of Ghana (BoG) approved the takeover of Capital Bank and UT Bank by GCB Bank on August 14, 2017, citing the insolvency of the acquired banks for the basis for the revocation of their licenses.
Five other banks, including the Royal Bank, Unibank Ghana Ltd, Beige Bank Ltd, Sovereign Bank Ltd, and Construction Bank Ltd, were consolidated into the bank known today as the Consolidated Bank.
Speaking at his final State of the Nation Address on Friday, January 3, 2025, he stated the exercise was needed to safeguard the country’s financial sector.
“The banking sector cleanup undertaken by my administration was an act of necessity, not a vendetta. It was a bold and decisive intervention to safeguard the strength and integrity of Ghana’s financial system. The illegalities and irregularities perpetuated by the affected banks and financial institutions are well documented and indisputable,” he said at the Parliament of Ghana.
The exercise, which the government insisted was necessary to “restore confidence” in the banking sector, also affected 347 microfinance companies, 39 microcredit companies, 15 savings and loans companies, 8 finance house companies, and 2 non-bank institutions.
