Bank of Ghana to divest remaining stakes in ADB, NIB to focus on regulation

The Bank of Ghana (BoG) plans to divest its remaining stakes in the Agricultural Development Bank (ADB) and the National Investment Bank (NIB), reinforcing its commitment to functioning solely as the nation's banking regulator. The central bank stated it cannot simultaneously act as both a regulator and a player within the banking industry.

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The Bank of Ghana Board has taken the decision that we should dispose of our remaining shareholding in ADB. With time, and hopefully later this year, that will be done.

Dr. Johnson Pandit Asiama, Governor of the Bank of Ghana and Chairman of the Monetary Policy Committee (MPC), announced that the BoG's Board has approved this decision. He emphasized the impropriety of the BoG regulating the banking sector while holding ownership interests in commercial banks. Speaking at the 131st MPC press conference in Accra, where the committee decided to maintain the Monetary Policy Rate at 14 percent, Dr. Asiama disclosed that the BoG holds a residual stake of approximately 13 percent in ADB and about one percent in NIB. Both shareholdings are slated for sale before the end of the year.

"The Bank of Ghana Board has taken the decision that we should dispose of our remaining shareholding in ADB. With time, and hopefully later this year, that will be done," he stated. "In the case of NIB, we still have a very small residual shareholding of about one per cent, and that will also be disposed of. The Bank of Ghana certainly will get out of that space. We are a regulator and will continue to be a regulator," Dr. Asiama added.

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In the case of NIB, we still have a very small residual shareholding of about one per cent, and that will also be disposed of. The Bank of Ghana certainly will get out of that space. We are a regulator and will continue to be a regulator.

Regarding the decision to maintain the policy rate at 14 percent, Governor Asiama explained that the MPC carefully evaluated both upside and downside risks to inflation and economic growth. He noted that the committee's decision is based on a majority vote among its seven members. "There are factors that pose upside risks and others that pose downside risks. At the end of the day, it is the balance of these factors and where they are tilting that informs the decision," he said.

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There are factors that pose upside risks and others that pose downside risks. At the end of the day, it is the balance of these factors and where they are tilting that informs the decision.

Dr. Asiama also addressed climate-related financial risks, affirming the central bank's dedication to ensuring commercial banks integrate environmental considerations into their lending practices. He acknowledged that while financial institutions have until 2027 to fully implement the BoG's climate guidelines, recent flooding incidents highlight the urgent need to address climate risks. "The recent flooding has shown that these risks must be taken seriously. As a central bank, we will continue to ensure that environmental concerns are integrated into the credit decisions of commercial banks," he concluded.

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The recent flooding has shown that these risks must be taken seriously. As a central bank, we will continue to ensure that environmental concerns are integrated into the credit decisions of commercial banks.