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The presidential candidate of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia, has taken swipe at National Democratic Congress (NDC) flagbearer John Dramani Mahama for his recent promise to restore the licenses of several financial companies that collapsed during the NPP’s administration.
At the NDC manifesto launch in Winneba, Mahama pledged to reinstate the licenses of financial companies that he felt the NPP administration had improperly closed.
In a media appearance on Sunday, August 25, however, Dr. Bawumia expressed surprise at Mahama’s stance, stating, “We saved the deposits of 4.6 million bank depositors who really were going to lose their deposits if those banks were not saved.”
“I don’t understand whether the former president has taken his time to understand the banking sector. Some atrocious things and this is why these banks had to be saved.”
“They were not collapsed, they were merged into other banks and no banking depositor lost 1 cedi, everybody maintained. But very bad things happened, some of the banks broke all the rules and extended loans way above the single obligor limits,” Bawumia added.
“They were given, in some cases, one billion by the Bank of Ghana to help them out of the mess and they only got deeper into the situation,” stated the NPP presidential candidate. Instead of using the capital provided to other banks to solve their own problems, the banks established Capital Bank using the money meant to salvage the situation. They started another company that failed as well, using the money they had taken from the central bank. A few grabbed the money and put it into investments in homes.
“So, it was against this background the governor came to report, and this was one of my nightmares in the last eight years. Most people didn’t understand how close we were to a collapse of the entire banking system. This is how we had to merge many of these banking sectors into other banks and we saved 4. 6 million depositors.”
He further emphasized that bank license restorations are subject to legal processes and cannot be carried out at random.
“He cannot hand over a bank’s license to them, this is subject to legal procedure,” he stated.
Source: Ghanatodayonline.com
