The Bank of Ghana failed to follow the correct procedures when it cancelled the operating licence of GN Savings and Loans. A Court of Appeal ruling on May 21, 2026, stated the central bank did not adhere to proper regulatory safeguards. The court has ordered the Bank of Ghana to restore the licence. It must also return all assets belonging to GN Savings and Loans shareholders.
Cletus Alengah, counsel for GN Savings and Loans' owner Papa Kwesi Nduom, highlighted the central bank's alleged oversight. He argued that the Bank of Ghana and the High Court acted solely on insolvency claims. They neglected to implement necessary regulatory checks. Mr. Alengah stated that GN Savings and Loans possessed adequate capital to continue operations. He believes both the High Court and the Bank of Ghana bypassed crucial steps before the 2019 licence revocation. These findings were presented to the High Court but allegedly received little attention.
The revocation was done under Section 123 of the relevant banking act. This section permits licence cancellation only if a financial institution is insolvent. The responsibility to prove insolvency lies with the Bank of Ghana. However, the High Court had shifted this burden to GN Savings and Loans. The company had to prove it was not insolvent. The Court of Appeal found this to be contrary to established regulatory practice. Determining insolvency is a regulatory function of the central bank, not a burden for the affected entity to disprove.
This Court of Appeal decision carries significant weight for Ghana's financial regulatory landscape. It reinforces the importance of due process. It signals a need for stricter adherence to established procedures by the Bank of Ghana. The ruling may also encourage other financial institutions facing regulatory action. Future decisions by the central bank will likely undergo closer scrutiny.
The implications of this ruling are far-reaching. It raises questions about the Bank of Ghana's past decisions. It could lead to a re-evaluation of other licence revocations. Investors and market participants will watch how the Bank of Ghana responds. The central bank's next steps are crucial for maintaining confidence in Ghana's financial sector. The restoration of the licence for GN Savings and Loans marks a pivotal moment.