President Akufo-Addo
President Nana Addo Dankwa Akuffo-Addo has said that his government has made the necessary arrangements to pay all depositors of failed financial institutions, including DKM.
Presenting his fourth State of the Nation Address in Parliament yesterday, he indicated that an extra GHC5 billion to pay affected depositors of failed financial institutions “a 100% of their deposits” has been made available.
The payments will be done once the process to validate all the claims is completed, the President said.
In a surprise move, the President also said that depositors affected by the collapse of DKM, a microfinance company whose failure was registered under the previous administration, will be paid in full after the validation of their claims.
Inherited poor financial sector
Faced with an inherited, looming financial sector crisis upon taking office in 2017, the Akufo-Addo administration embarked on a financial sector cleanup, which required an emergency decision to save depositors’ funds locked up in failed financial institutions.
In a recent interview, the Minister for Finance, Ken Ofori-Atta, lamented over the poor state of the financial sector when the current came to office.
“When we came in 2017, the asset quality reviews were clear from the Bank of Ghana as to where we were in the banking system. But the courage to make that decision [to clean up the sector] had not really be invoked and we went ahead to do it,” he said.
The financial sector cleanup exercise, according to President Nana Akufo-Addo, has so far cost his government and the taxpayer close to GHC12 billion in an effort to protect depositors and investors.
This was before a December 2019 approval from Parliament to spend GHC16.4 billion to support the payment of all depositors of failed specialised deposit taking institutions and micro finance institutions (MFIs) in full.
Unpacking the emergency effort made by his government in 2017, to avert what was an imminent crisis in the financial sector following years of careless governance under the former administration, President Nana Akufo-Addo the state “will hold all those responsible for the failure of these institutions accountable”.
