- banks’ board members, CEOs retire
- board executives undergoing training
Banks are highly compliant with the Bank of Ghana’s directive on Corporate Governance and the Fit and Proper Persons, Dr. Ernest Addison, Governor of the Central Bank, has said.
Introduced a couple of years ago to streamline operations of the boards and management of banks, these directives –which among others set term limits on board membership, CEOs’ tenure, and obliges board members to undergo training– have so far strengthened the operations of banks and have significantly enhanced the soundness of the banking system.
“Enforcement of the Corporate Governance Directive has led to several board chairs and CEOs of banks ending their tenure, while board members who had served for prolonged periods have been replaced,” the Governor said at the official launch of Absa Bank Ghana Limited in Accra.
Results of a recent survey, he showed, indicate full compliance with requirements of the Corporate Governance Directive on the size, structure, composition and qualification of bank Boards; due diligence in the appointment of key management personnel; and separation of the positions of CEOs and Board Chairs.
A total of 184 bank directors undertook the mandatory annual Directors’ Corporate Governance Certification training programme. Of this number, over 50percent have fully completed the programme, while the rest who are at various certification stages will be certified by the deadline of end-March 2020.
“The performance indicators just enumerated, is a broader reflection of the current state of the entire banking sector and an attestation that the reforms undertaken by the Bank of Ghana within the intervening period are beginning to yield the desired results.
The banking industry has built up a much stronger balance sheet and recorded strong asset growth, improved quality of loans and profitability during the year. All the financial soundness indicators, measured in terms of earnings, liquidity, and capital adequacy remained strong,” he said.
Despite the good performances by the banks, Dr. Addison stressed that as regulators, the BoG would continue to hold banks accountable and would ensure the continuous sanity of the sector, and consistently apply the laws applicable to the sector.
“Let me reiterate that as regulators, we will continue to commit our resources towards ensuring that financial institutions improve their internal controls and risk management systems since the safety and soundness of institutions pivots on these principles,” he said.
He added that the BoG would continue to create an enabling regulatory environment that encourages innovation in the industry, while ensuring that it continually strengthen its supervisory and enforcement capabilities to ensure sanity in the industry.
“That way, we can ensure that Ghana’s banking business is conducted in a safe and sound manner and with integrity, thereby retaining the trust and confidence depositors, and indeed the general public, reposed in the industry,” he said.