Financial Crime World

Title: Bank of Ghana’s Role as Regulator: Ensuring Compliance in Ghana’s Financial Sector

The Bank of Ghana as the Regulatory Authority

In the economic heart of Ghana, the Bank of Ghana (BoG) plays a significant role as the overall supervisory and regulatory authority for banking and non-banking financial businesses. This role is crucial in creating a robust, efficient banking system that caters to the interests of depositors, customers, and the economy as a whole.

The regulatory and legal cornerstone of Ghana’s financial sector rests on several key pieces of legislation:

  • Bank of Ghana Act, 2002 (Act 612)
  • Bank of Ghana (Amendment) Act, 2016 (Act 918)
  • Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930)
  • Non-Bank Financial Institutions Act, 2008 (Act 774)
  • Companies Act, 2019 (Act 992)
  • Bank of Ghana Notices, Directives, Circulars, and Regulations

BoG’s Role according to Act 612 and 673

Under the Bank of Ghana Act, the central bank is tasked with maintaining a stable financial system that supports wealth creation, economic growth, and development. The BoG’s responsibilities as a regulator include:

  • Regulating, supervising, and directing the banking system and credit system
  • Appointing a head of Banking Supervision Department
  • Proposing banking law reforms

Ensuring Compliance and Maintaining Standards

As part of its mandate, the BoG works diligently to ensure that:

  • Depositors’ funds are secure
  • Banks maintain solvency, good asset quality, adequate liquidity, and profitability
  • Statutory and regulatory requirements are enforced
  • A fair banking marketplace is maintained
  • An efficient payment system is operational

Regulatory Environment

The regulatory environment in Ghana’s financial sector encompasses various aspects, including licensing, license revocation, monitoring, and powers and duties of supervisors. Protecting the supervisor is also a vital consideration.

Protection of the Supervisor

Historical Context

Looking back at Ghana’s history, the BoG assumed control of currency issuance on July 14, 1958. With the issuance of Ghana pounds, shillings, and pence, the bank took the reins from the West African Currency Board (WACB).

Basel Core Principles

As part of its ongoing efforts to strengthen the legal and regulatory framework, the BoG’s supervisory functions adhere to the Basel Core Principles for Effective Banking Supervision. These principles promote international best practices, ensuring that Ghana’s financial sector remains competitive and agile in a globalized economy.