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05.12.2004 Business & Finance

BOG will step up supervision of the banking sector

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Accra, Dec. 5, GNA - The Bank of Ghana (BoG) on Saturday said it would pursue a rigorous prudential supervision of the sector to ensure compliance with banking norms to sustain financial stability. Dr Paul Acquah, the Central Bank Governor, said the BoG would move away from the tradition of regulatory tolerance and nurturing of banks to one of strict surveillance in line with current maturity and complexity of the financial system.

"The regulatory framework will be applied fairly with the intent of maintaining a liberal arrangement that leaves room for innovation, but also imposes on banks, the responsibility for delivering robust risk management and internal controls in support of a sound credit culture," he told members of the Chartered Institute of Bankers at their annual dinner in Accra.

The dinner was to round off the Institute's Bankers Week celebration on the theme: "Challenges and Opportunities Facing the Financial Services Industry in a Stable Macroeconomic Environment." Dr Acquah said the Central Bank needed to be vigilant but this did not mean it was going to stand in the way of financial institutions, which abide by laid down regulations and whose actions did not jeopardize the stability of the financial system.

He underscored the importance of international best practice and good corporate governance and accounting standards in building a strong financial services sector.

In line with this goal, he said, the BoG was implementing some policy initiatives to lay the foundation for a financial services sector that could support accelerated growth.

"We are building a legal and institutional framework to remove deficiencies and develop the financial payments infrastructure and settlement systems to make the financial system robust and competitive in an international trading system, and resilient to reduce the vulnerability of the economy to shocks," he said.

Dr Acquah called on banks to play their roles effectively to produce the type of financial system that would build on the emerging macroeconomic stability to promote accelerated growth and poverty reduction.

Mr Edward Boakye-Agyeman, President of the CIB, said the Institute had maintained its high standards for professional qualification of bankers.

Students who excelled in the various examinations were awarded prizes.

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