Banking diplomacy?

Professor Kwame Boafo-Arthur, I salute you this day with a soft tone of respect. This write-up made me remember your camaraderie and the sense of humour during your lecture periods a decade ago when you taught us International Relations and by the contents, Diplomacy. From hindsight, it comes to mind with the understanding that diplomats’ careers involve communicating, in the most persuasive way the policies of their home governments to others abroad; and in doing so, appeal to the foreign governments to reciprocate in ways that favour the home country’s national interests.

Caskie Stinnett, a writer, provides the mental picture of a diplomat as aperson who can tell you to go to hell in such a way that you actually look forward to the trip”. From my understanding, this statement generally means that diplomats develop the arts and skills of communication to convey what otherwise could have been a difficult message to their audience and yet obtain a favourable response from them.

Clearly, this viewpoint establishes the fact that diligence in language-use is very necessary for diplomatic communication to achieve the intended results. Thus, many career diplomats employ tact and finesse to convey their messages, since it is not easy as we may think to use language as the means for transmitting of one’s thoughts to recipients. That’s to say while others will be blunt in their remarks on certain issues, diplomats will make comments with a dignified approach.

Interestingly, it is not only diplomatic circles which require individuals or professionals to exhibit the salient traits necessary to express their opinions, ideas or share information. Organisations, especially business entities with profit motives, also need these skills as well – insofar as they relate to their stakeholders.

In that respect, you will share my opinion that businesses can either win or lose public support depending on how issues relating to them are conveyed by regulators or state officials to the public. This is also based on the premise that the source of an information and credibility of the messenger cannot be downplayed in helping people make informed decisions. That is why public comments by the Governors of central banks are not treated lightly in the banking fraternity.

Brush with the law

What else can I say when we already know that some financial institutions in the banking and capital markets in recent times have had a brush with the law (regulations) and were sanctioned by their regulators – the Bank of Ghana and Securities and Exchange Commission respectively. With regard to the banking sector, the public disclosure of information regarding regulatory breaches which led to the sanctions, or the directives, triggered uncertainty in terms of the safety for depositors’ investments.

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Though the intentions by law are meant to safeguard sanctity of the banking front, the public expressed sentiments of apprehension. Meanwhile, banks – like other businesses operating in any economy – at a point in time experience difficult times collectively as an industry or individually. Hence, they generate uncertainties which lead to a general loss of public confidence in their activities – or cause the share prices of those listed on the stock exchange to fall.

In this kind of situation, it has always been necessary to manage the recovery process with circumspection because the media cannot be left out in relaying information to the public. This is when the art of diplomacy is more urgent in media engagements to deal with issues on the public’s mind. Therefore, I find it opportune to use the recent flagship events – Graphic Business/Stanbic Bank Breakfast forumand the Ghana CEOs’ Summit to deepen the conversation.


Earlier on, we witnessed instances when news items on the banking fraternity were worrying. It was like a baptism of fire for every player in the sector and had to be contended with – so as to avoid the negative effects. Be that as it may, the views of key speakers at the Breakfast Meeting made the news. The headline of the Graphic newspaper after the event screamed: Our banks are resilient; Speakers at Graphic Business/Stanbic Bank Breakfast forum assure public”.

The catchword ‘resilient’ means a lot in portraying the banking industry’s image considering the apt credibility of the paper and professional standing of the key resource persons – including the Second Deputy Governor of the Bank of Ghana (BoG), Ms Elsie Addo Awadzi. The panellists gave the strongest indication (yet) that the country’s banks are safe and strong” to support the country’s financial needs. In short, they consider the sector healthyand that there is no cause for alarm. The Deputy Governor, for instance, has unfettered access and a repertoire of information on the health of financial institutions. This makes her views weightier in all respects. “No be so?”

Indeed, she minced no words in reiterating the central bank’s resolve to perform its regulatory duties and ensure that financial institutions become stronger and better”. To become stronger and better in my understanding is a confirmation that the overall banking sector at the moment is strong. “No be so?”

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Interestingly, the Ghana CEOs’ Summit also ended few days after the Breakfast Meeting and President Nana Addo Danquah Akuffo-Addo made the Graphic headline with the caption Distressed Local Banks… Let BoG Sanitise – Prez tells Ghanaians’.

What a catchy headline! The word distressedcaught my attention, and I am sure a local bank manager out there soliciting for businesses will not be comfortable with the “distressed” description. But after reading the two headlines being attributed to the key personalities with high public standing, can we say that we have a distressfully resilient or resiliently distressed banking sector? Can we also say that the president was forthright in his views to the public, while the Deputy Governor also did the same but in a more diplomatic manner?

Crème de la crème

What’s more, after reading the two publications’ contents, I am inclined to say that the two personalities among others conveyed similar sentiments about the prevailing conditions in the banking sector but had the same minted cedi coin – with one of the two sides being resilient and the other distressed. Aside from this, we can also agree that the president and deputy governor’s observations have a middle-ground – the banking sector needs regulatory reforms to overcome its challenges.

As fate would have it, the president addressed the top CEOs – the crème de la crème which included those from the banks, some of whom constituted the Association of Indigenous Universal Banks and had petitioned him for an extension to the GH¢400m recapitalisation deadline, which led to the formation of a committee to consider the appeal. While addressing them, the president is reported to have said: I want to urge all of us to allow the regulator, which is the Bank of Ghana, to deal with these matters and restore sanity and confidence. It is in our interest that all financial matters are dealt with without any political interference”.

When we connect the facts of the petition with the president’s message at the summit, to allow the Bank of Ghana to work without any political interference, then you will agree with me that he delivered a note through his diplomatic cables to our local bank managers. After decoding the message, my managers will come to the full realisation that the 400k deadline-extension petition has finally hit a snag and the committee’s work will not meet their expectations. Banking Diplomacy? What do you say?

Blessed Times, God is with us. Thank You. It’s bye for now.

The writer is a Chartered Banker


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