whole, and must be made to exit before they collapse the whole system. what happens to the financial system affects everyone! the defunct banks had reached a point where they were no longer able to operate as banks. 4 of the 7 had been found to be significantly undercapitalised as of the 2015 / 16, and subsequently became insolvent when their capital was further impaired due to bad loans and other irrecoverable assets. the other 3 defunct banks obtained their licenses by false pretences through the use of suspicious and non - existent capital, which rendered them significantly undercapitalized compared to the minimum of ghs 120 mn they were required to have. underlying these failures were a pattern of poor corporate governance practices, insider dealings, misreporting, and other practices which put depositors ’ funds at risk. in taking these actions, bog sought to : protect the deposits ( about ghs11 billion ) held by these defunct banks ; ensure that these defunct banks exited the market in an orderly fashion without creating disruptions to the rest of the system ; and allow stronger institutions to operate and support the economy. q. what has been the impact of the bog ’ s actions against the failed banks on the financial sector and beyond? bog ’ s actions against the failed banks and government ’ s decision to guarantee the deposits of the 7 banks and the creation of cbg have helped to mitigate what could have been severe adverse consequences from these failures. when banks fail, there are usually a lot of casualties, which if not well managed could lead to significant problems for the financial sector and the economy. the interventions of the bog and mof : protected about ghs 11 billion in customer deposits, including deposits and placements of other financial institutions ( banks, savings and loans, rcbs, mfis, insurance firms, securities firms and fund managers, and pension fund managers ) ; minimized job losses by saving some 3, 500 or 70 % of appx 5000 employees of the defunct banks ; the banking sector reforms have boosted the confidence of local and international investors and other market players in the bog ’ s role as regulator, and have contributed to the recent upgrades to ghana ’ s credit rating from s & p from b - to b. q. the clean - up has been costly to the tax payer. how will this be recovered if at all? the clean - up costs were necessary policy interventions to help mitigate the socio - economic impacts of the failure of the banks

be the structure of financial sector regulation going forward. currently, there are different regulatory agencies with mandates to regulate different parts of the financial sector. each of these agencies have the requisite understanding of their respective sectors and should work on improving their own effectiveness as may be needed. more cooperation is also needed among all the regulators. this will help ensure that each regulator has visibility on the other parts of the financial system and has a clear understanding of how their actions and the actions of their licensees affect other parts of the system and vice versa. closing remarks let me conclude by reassuring everyone that the bog is carrying out the mandate it has under law to ensure the safety and soundness of banks and other deposit - taking institutions, to protect depositors ’ funds, and to promote integrity and stability of the financial system. bog is committed to supporting the banks and other financial institutions that are playing by the rules of the game. we are working together with all stakeholders to build a resilient banking sector that has the trust and confidence of everyone and that support the national economic growth agenda.