Bank of Ghana
The Bank of Ghana is the Central Bank of Ghana. It is located in Accra and was formed in 1957. The Bank of Ghana has Seven Regional Offices in addition to its head office in Accra. The regional offices are located in the following cities, Hohoe, Kumasi, Sunyani, Tamale, Takoradi, Bolgatanga, Wa. The regional offices are responsible for implementing the policies and directives of the Bank of Ghana in their respective regions. They also provide banking services to the government, financial institutions, and the public.
The bank is active in developing financial inclusion policies and is a member of the Alliance for Financial Inclusion.
Establishment of the Bank of Ghana
The Bank of Ghana was formally established on 4 March 1957, just two days before Ghana's declaration of political independence. The British Parliament passed the Bank of Ghana Ordinance of 1957 to make it official. By mid-July 1957, all necessary preparations were completed for the official inauguration of the Bank's new Head Office on High Street.Since 1957, the Bank of Ghana has experienced various legislative changes. The original Bank of Ghana Ordinance of 1957 was replaced by the Bank of Ghana Act, Act 182, which was later amended by the Bank of Ghana 1965,. Eventually, the Bank of Ghana Law, 1992 PNDCL 291, consolidated the legal framework for the bank by repealing both Acts 182 and 282.
History
The Central Bank of Ghana traces its roots to the [Ghana Commercial Bank|Bank of the Gold Coast (BGC)] or Ghana Commercial Bank, where it was nurtured. As soon as local politicians and economists saw political independence in sight in the mid-1950s the agitation for a central bank was revived. It was argued that a central bank was one institution which would give true meaning to political independence. It may be recalled that way back in 1947, some leading politicians had called for the establishment of a national bank, with central bank functions to act as banker to government and to cater for the indigenous sector of the economy.Proposals of the advocates for a central bank were accepted and in early 1955, another select committee was set up by the government to take a new look at the Trevor Report and prepare the grounds for the establishment of a central bank in Ghana. The BGC had already set the stage for central banking: all that was needed was specially trained personnel in central banking and suitable accommodation for the bank to take off.
By the end of 1956, all was set for the establishment of the Bank of Ghana. A new and modern five-storey building had been put up on the High Street, adjacent to the Accra Metropolitan Assembly (AMA) to house both the Bank of Ghana and the Ghana Commercial Bank (GCB).
In March 2012, the Bank of Ghana announced it would be making specific commitments to financial inclusion under the Maya Declaration.
Governance of the Bank of Ghana
The first governor of the bank was Mr. Alfred Eggleston, the former managing director of BGC and an accomplished Scottish banker on secondment to Ghana from the Imperial Bank of India. His deputy governor was one Mr. Douglas F. Stone, another renowned British central banker also on secondment from Bank of England.The general administration of the bank was entrusted in the hands of a seven-member board of directors under the chairmanship of the governor.
The first board was as follows:
- Alfred Eggleston, chairman
- Douglas F. Stone, deputy governor
- R. S. Blay, director
- N. T. Clerk, director
- C. E. Osei, director
- R. C. Parkin, director
Governors
The following is a list of governors till dateDepartments
In 1957, the bank commenced business with six main departments namely:- The governors' office
- The administration/personnel department
- The banking department
- The issue department
- Accounts/audit department
- Economics/statistics department
With that initial organisational arrangements, the Bank of Ghana assumed its central role in the banking system of Ghana, which then comprised the central bank, two expatriate commercial banks – the British Bank of West Africa (BBWA) (now [Standard Chartered Bank)] and Barclays Bank Limited ; and the new Ghana Commercial Bank.
There was also the Post Office Savings Bank, which was in fact, not a bank by definition; it was only an institution set up by the government to mobilize public savings through the agency of the numerous post offices in the country, for investment in government paper.
Relations with the other banks in the system were set out under sections
39 – 42 of the 1957 Ordinance. Initially, the relation were not very strong. The Central Bank was to act as banker to other banks and co-operate with them to promote and maintain adequate and reasonable banking services for the public. It was also to ensure high standards of conduct and management in the banking system. The bank was also given powers to require the banks to maintain a proportion of their assets in specified form and to submit monthly returns on their operation to the Central Bank. However, banking supervision or bank examination was not specifically highlighted in the Ordinance.
Functions
As a Central Bank of Ghana, it function is as follows:- Formulate and implement a monetary policy aimed at achieving the objectives of the Bank;
- Promote by monetary measure the stabilization of the value of the currency within and outside Ghana;
- Institute measures that are likely to have a favorable effect on the balance of payments, the state of public finances, and the general development of the national economy;
- Regulate, supervise, and direct the banking and credit system and ensure the smooth operation of the financial sector;
- Promote, regulate, and supervise payment and settlement systems;
- Issue and redeem the currency notes and coins;
- Ensure effective maintenance and management of Ghana's external financial services;
- license, regulate, promote, and supervise non-banking financial institutions;
- Act as banker and financial adviser to the Government;
- Promote and maintain relations with international banking and financial institutions and subject to the Constitution or any other relevant enactment, implement international monetary agreements to which Ghana is a party; and
- Do all other things that are incidental or conducive to the efficient performance of its functions under this Act and any other enactment.
Bank of Ghana in the news
Lawsuits
Dr. Papa Kwesi Nduom and the Others
In August 2019, Dr. Papa Kwesi Nduom and other individuals filed a lawsuit against the Bank of Ghana and other parties concerning the cancellation of the license of GN Bank/Savings.The Bank of Ghana disputed the High Court's jurisdiction by asserting that, as per the Banking Act, license revocation matters should be resolved through arbitration instead of court proceedings.
Controversies
''New Bank of Ghana Headquarters''
In August 2023, the Bank of Ghana through a press briefing described with justifications, its move to building a new headquarters to replace its current building. The Bank of Ghana in Accra released a document on August 21, 2023, containing this disclosure.The decision to build the new edifice was met with mixed reactions as the Minority in Parliament of Ghana and some Civil Society Organizations strongly opposed the new building, stating that such projects are unnecessary given the current economic situation of the country. Consequently, they criticized the Governor of the Bank of Ghana and his deputies, urging them to step down and declared their plan to stage a protest at the Bank of Ghana on September 5, 2023, seeking the departure of these officials.
Other distinguished members of the society including the Dormaahene, Osagyefo Oseadeeyo Agyemang Badu II have also expressed their reservations towards the decision of the Bank of Ghana's leadership.
On the other side, the Deputy Minister for Trade, Dr Stephen Amoah, called the action of those calling for the resignation of the governor as unnecessary.