BoG to Challenge Court Ruling on CDH Savings and Loans License Revocation
Bank of Ghana Defends Its Decision Amid Controversy Over Financial Stability Measures
- The ruling labeled the BoG's asset liquidation directive as unreasonable and unfair
- CDH Savings and Loans failed to address multiple notices about its declining Capital Adequacy Ratio
- BoG plans to contest the ruling
The Bank of Ghana (BoG) has announced its intention to appeal a recent High Court decision that overturned the revocation of CDH Savings and Loans’ license.
The court, presided over by Justice Nana Brew, deemed the BoG’s directive for CDH to liquidate assets in response to solvency and liquidity issues as “unreasonable and unfair.”
However, the ruling did not address the numerous notices issued by the BoG urging CDH to improve its Capital Adequacy Ratio (CAR), which had consistently fallen short of the minimum requirements.
Sources indicate that despite significant liquidity challenges and potential systemic risks, CDH did not take action on these warnings.
The BoG had issued a final two-week notice for asset liquidation, one of several measures taken before revoking the bank’s license.
The BoG stands firm, citing Act 930 to argue that the license revocation was conducted “regularly and lawfully” in the interest of financial stability, rejecting claims of unfairness.
The Bank plans to appeal to the Court of Appeal, highlighting that prior license revocations during the banking sector cleanup have been validated by both the High Court and Supreme Court.
